SBA DISASTER LOAN
SBA Consultant
SBA Disaster Loan
The SBA offers disaster assistance in the form of low-interest loans to businesses, renters, and homeowners located in regions affected by declared disasters. You can apply for a low-interest disaster loan to help recover from declared disasters. If your insurance, and funding from the Federal Emergency Management Agency (FEMA), doesn’t fully cover the disaster assistance you need, you can use disaster loans for a number of purposes. These include:
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Real Estate
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Personal Property
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economic Injury
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Machinery
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Equipment
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Inventory
SBA DISASTER LOAN - Eligibility
Who is eligible to apply for an SBA Disaster Loan? The Small Business Administration states that businesses, renters, and homeowners located in regions affected by declared disasters, who may have suffered PHYSICAL damage or ECONOMIC injury may be eligible for a low-interest SBA Disaster Loan.
SBA ECONOMIC INJURY DISASTER LOAN (EIDL) - Coronavirus or Covid-19
What is an SBA Disaster Loan for Covid-19? Health and government officials are working together to maintain the safety, security, and health of the American people. Small businesses are encouraged to do their part to keep their employees, customers, and themselves healthy.
In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. The SBA’s Economic Injury Disaster Loan (EIDL) program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. This loan advance will not have to be repaid.
COVID-19 SBA ECONOMIC INJURY DISASTER LOAN (EIDL) - Qualifying Business
Does my business qualify for an SBA Disaster Loan for Covid-19? As per the Small Business Administration guidelines, Small businesses under one of the following categories may qualify for a Covid-19 Corinavirus SBA disaster loan:
Applicant is a business with not more than 500 employees.
Applicant is an individual who operates under a sole proprietorship, with or without employees, or as an independent contractor.
Applicant is a cooperative with not more than 500 employees.
Applicant is an Employee Stock Ownership Plan (ESOP), as defined in 15 U.S.C. 632, with not more than 500 employees.
Applicant is a tribal small business concern, as described in 15 U.S.C. 657a(b)(2)(C), with not more than 500 employees.
Applicant is a business, including an agricultural cooperative, aquaculture enterprise, nursery, or producer cooperative, that is small under SBA Size Standards found at https://www.sba.gov/size-standards.
Applicant is a business with more than 500 employees that is small under SBA Size Standards found at https://www.sba.gov/size-standards.
Applicant is a private non-profit organization that is a non-governmental agency or entity that currently has an effective ruling letter from the IRS granting tax exemption under sections 501(c),(d), or (e) of the Internal Revenue Code of 1954, or satisfactory evidence from the State that the non-revenue producing organization or entity is a non-profit one organized or doing business under State law, or a faith-based organization.
COVID-19 SBA ECONOMIC INJURY DISASTER LOAN (EIDL) - Other Eligibility
What other eligibility does the SBA require to be approved for a Covid-19 SBA Economic Injury Disaster Loan (EIDL)? As per the Small Business Administration guidelines, small businesses must also satisfy all of the requirements below top be eligible for a Covid-19 Corinavirus SBA disaster loan:
Applicant is not engaged in any illegal activity (as defined by Federal guidelines).
No principal of the Applicant with a 50 percent or greater ownership interest is more than sixty (60) days delinquent on child support obligations.
Applicant is not an agricultural enterprise (e.g., farm), other than an aquaculture enterprise, agricultural cooperative, or nursery.
Applicant does not present live performances of a prurient sexual nature or derive directly or indirectly more than de minimis gross revenue through the sale of products or services, or the presentation of any depictions or displays, of a prurient sexual nature.
Applicant does not derive more than one-third of gross annual revenue from legal gambling activities.
Applicant is not in the business of lobbying.
Applicant cannot be a state, local, or municipal government entity and cannot be a member of Congress.
If the business applying for the Covid-19 (Coronavirus) SBA Economic Injury Disaster Relief Loan (EIDL) is unable to check all of the above, the business is not considered an Eligible Entity
Loan Limits
Homeowners - $200,000
Businesses - $2,000,000
The amount SBA will lend depends on the cost of repairing or replacing your business and business contents, minus any insurance settlements or grants. Homeowners may apply for up to $200,000 to repair or replace their disaster damaged residence. Small businesses, small agricultural cooperatives and private non-profit organizations may be eligible for economic injury. These loans could not exceed $2 million to repair or replace damaged property or economic injury.
Loan Terms and Interest Rate
Interest Rates and Length of Time to Repay Loan
Per the Small Business Administration, the interest rate on these loans is determined by law. SBA assigns an interest rate to a loan based on the resources available to an applicant. The lower interest rate will not exceed 4 percent and the interest rate associated with current market rate will not exceed 8 percent. The rates are fixed for the term of the loan. Please refer to the SBA's Small Business Administration Fact Sheet link for the declared disaster for which you are applying.
When To Apply
Should I wait for my settlement before I apply?
No. Absolutely not!
Applications should be filed immediately, the sooner the better.
Do not miss the filing deadline by waiting for an insurance settlement.
SBA can approve a loan for the total eligible losses within the administrative guidelines and later adjust the loan eligibility or balance if insurance funds are received.
SBA DISASTER LOAN CONSULTANT
The Coronavirus or Covid-19 stimulus package is partially covered under SBA's disaster loan category. Since the Covid-19 Economic Injury Disaster Loan (EIDL) is a relatively new loan program, its dynamics are still being discovered. Call SBA Consultant for more information.
COVID-19 DISASTER RELIEF
For small businesses, navigating through all the available SBA business relief options and making important business decisions such as whether to lay off or furlough employees can mean the difference between succeeding or going out of business. Call SBA Consultant to help you plan your path to success.
FEDERAL EMERGENCY MANAGEMENT AGENCY
The FEMA program is a safety net available only to individuals and families, and is not available to businesses. It is intended to help meet essential needs not met by any other SBA disaster loans.
DISASTER RELIEF LOAN COLLATERAL
Loans which exceed $25,000 must be secured to the extent possible. SBA will not decline a loan if you don’t have enough collateral, but will ask for whatever collateral is available which may include real estate. For individuals, SBA may also take a lien on any damaged residential property.