What You Should Know About SBA Disaster Loans

out of a mess with a disaster loan

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With the onslaught of natural disasters that have occurred over the past few years, many businesses have suffered the loss or damage of assets, and more. These physical and economic damages have caused many businesses to have to shut their doors, or reduced their production and output.

To help combat some of the problems for homeowners, renters, and businesses — both private and non-profit — the SBA provides low-interest disaster loans to help repair or replace real estate, property, machinery, equipment, inventory, and other business assets that may have been destroyed or damaged by a declared disaster.

SBA has disaster offices throughout the country, where they provide low-interest, long-term loans. There are a variety of SBA loans, including:

The loans that are of greatest importance to businesses are physical disaster loans and economic injury disaster loans. Here is a little more information about said loans:

Physical Disaster Loans

Economic Injury Disaster Loans

For both loans, interest rates won’t exceed 4% if the business does not have credit available elsewhere. The repayment term may be up to 30 years, and will depend on the business’s ability to repay. If the business has credit available somewhere else they interest rate won’t exceed 8%. The loans may be applied for directly to the SBA, at which time the SBA will send out an inspector to estimate damage, if the loan is awarded, funds may only be used under the stipulated SBA guidelines.

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