Oct. 13 Deadline Approaches For SBA Physical Damage Loans
BATON ROUGE, La. — The Oct. 13 deadline to apply for Small Business Administration, or SBA, physical damage loans is rapidly approaching. Business owners, homeowners and renters who experienced damage by the severe August floods are encouraged to apply for SBA disaster loans, as failure to do so may disqualify them from additional federal assistance. Low-interest SBA physical damage loans are the primary source of federal disaster assistance for businesses, nonprofits, homeowners and renters to pay for repairs or replacement costs.
The SBA business physical damage loan covers property damage caused by the recent floods that is not fully covered by insurance or other sources. Businesses and private, nonprofit organizations can apply for up to $2 million to repair or replace business assets.
“The recent floods have severely impacted many small businesses in South Louisiana, but the State of Louisiana and our federal partners are committed to standing with small business owners and their employees as the recovery process continues,” Louisiana Economic Development Secretary Don Pierson said. “We strongly encourage affected small businesses to apply for the loans made available by the Small Business Administration, and use the resources at their disposal so they can return to business and put their employees back to work.”
The SBA also provides economic injury disaster loans for businesses. This working capital loan is designed to help small businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private, nonprofit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. Applications for the SBA’s economic injury disaster loan will extend into next year, with a final deadline of May 15, 2017. These loans are intended to assist through the disaster recovery period.
Both the business physical damage loan and the economic injury disaster loan have interest rates as low as 4 percent, and the law authorizes loan terms up to a maximum of 30 years. Businesses with available credit may be restricted to a maximum term of 7 years. The SBA sets the installment payment amount and loan term based upon each borrower’s ability to repay.
To date, the SBA has approved more than 10,600 disaster loans in a span of six weeks, and there are still many federal resources available to help small businesses recover and reopen. Links to loan applications, as well as other flood recovery resources can be found on OpportunityLouisiana.gov/Flood-Recovery-Assistance.