What are Small Business Administration Loans?
Sometimes insurance proceeds and FEMA assistance are not enough to repair a damaged home to a safe condition or to buy a new home. The Small Business Administration (SBA) makes low-interest loans available to disaster survivors to repair or replace their homes. Even if you do not qualify, applying for the loan is an important step in the recovery process. Many disaster survivors are unaware that simply applying for an SBA loan is often required to become eligible for other types of disaster assistance.
Applying for an SBA Loan
The government offers SBA Disaster Assistance Loans to homeowners. These are low interest loans that disaster survivors can use to recover from disasters. Homeowners are required to apply for an SBA disaster loan in order to apply for full FEMA assistance regardless of whether they qualify for the loan or choose to decline a loan offer. This is just part of the disaster assistance eligibility process.
I received an SBA loan application in the mail. I don’t own a business, and I wanted a grant from FEMA, not an SBA loan—why did I get this?
The Small Business Administration (SBA) serves an important role in disaster recovery. SBA loans are not just for business owners: homeowners and renters may also benefit from the loans. Interest rates are typically very low, with favorable terms for borrowers. Most FEMA grants are intended to meet immediate emergency needs and may not cover all your disaster-related losses. SBA loans are better suited to meet these non-emergency disaster related needs.
If you receive an SBA loan application, it is very important that you complete and submit it. Even if you are approved, you are under no obligation to accept any loan. After reviewing your application, SBA may determine you are not eligible for a loan and refer you to FEMA. At this stage in the process, you may become eligible for additional FEMA grant funds. If you fail to complete the loan application, you will lose the possibility of these additional grant funds.
The application should take approximately 30 minutes to complete. If you need assistance completing it, you may contact the SBA Customer Service Center at 1-800-659-2955.
For further information on SBA disaster assistance loans, please visit Disaster Loan Information (sba.gov)
