Grasping the Notion of SBA Disaster Loans

Hey there, it’s Lawscape from the Lawscape – and we’re about to delve into the world of SBA disaster loans. Picture this: your business is thriving. But out of nowhere, a natural catastrophe hits – just like Hurricane Harvey. And while you were safeguarding the financial functions of your business, you’d never expect it to get pummeled by a calamity out of your control. Fear not – this is where SBA disaster loans come in. Let’s get into the nuts and bolts of it all.

Getting Acquainted with SBA Disaster Loans

Distributing aid during challenging circumstances, the U.S. Small Business Administration, or the SBA, dishes out disaster loans to support businesses and homeowners bracing the impact of unforeseen disasters. Now, if your business is reeling under the clobbering of a natural disaster and lacks the financial muscle to continue operations, disaster loans are your knight in shining armor.

A Clear Picture on Disaster Loan Usages

All set to ensure your business doesn’t falter, disaster loans are versatile. Right from machinery and equipment, to real estate, inventory, and payroll – the loan amount can be utilized in multiple ways. It even covers economic injuries when the disaster disrupts the continuity of businesses that haven’t even had physical damage. Special provisions are also made for employees called to active duty during a disaster, further demonstrating its utility. But remember, the ultimate goal is recovery, not expansion or advancement.

Kinds of SBA Disaster Loans

Various types of disaster loans cater to different needs – be it a Business Physical Disaster loan, an Economic Injury Disaster loan, or a Military Reservist Economic Injury loan. These loans, primarily long-term and low-interest, can go up to $2 million based on specific requirements.

Qualification Criteria for SBA Disaster Loan Assistance

So, who can actually secure one of these loans? Well, any business battling physical or economic wreckage might be eligible. The SBA encourages businesses who are awaiting their insurance policies to consider disaster loans. But bear in mind, any successful insurance payouts must be funneled towards repaying the SBA loan. Even if your business has access to credit elsewhere, you’re still welcome to apply for the loan – though it may come with a higher interest rate.

Applying for Disaster Loans

Convinced that you need a disaster loan’s helping hand but unsure of how to proceed? Here’s how you do it: go straight to the US Small Business Administration website and check if your business falls within a declared disaster area. If it does, you’re good to go – click on “Apply for Assistance”. The best way to score a swift decision is by applying online.

Ensure you have all the necessary information at hand for a smooth application process – contact information, Social Security numbers, lease or deed details, FEMA registration number, insurance details, financial data including expenses and account balances, and your Employer Identification Number (EIN). With these details ready, the three-step process begins: applying online, the SBA’s review and verification of your losses, and preparation and dispatch of your loan documents. Post-signature of the loan documents, an initial payment of $25,000 pipes into your account for physical or economic damages. You’ll also be allocated a caseworker to oversee your compliance with loan conditions.

Understanding the Interest and Repayment Rates

Wondering what kind of interest and RP you can expect on your SBA-strapped disaster loan? Rates are set based on prime rates along with a markup, as part of SBA’s guidelines. Expect longer repayment periods, ranging from 7 to 25 years. The longer the term, the lower the interest, and hence, the regular payments.

Hit a Roadblock with an SBA Disaster Loan?

If you’ve found yourself defaulting on an SBA loan, it’s time for some robust and expert legal counsel. Contact us here at Lawscape, and we can help you manage through this frightening time.

Why Choose Us for Your SBA or Treasury Debt Concerns?

Over the years, we’ve resolved millions of dollars in SBA debts through Offers in Compromise and Negotiated Repayment Agreements, without pushing our clients into filing for bankruptcy or confronting home foreclosure. We’ve defended a king’s ransom worth of Treasury Debts through AWG hearings, Treasury Offset Program Resolution, Cross-servicing disputes, Private Collection Agency representation, Compromise Offers, and Negotiated Repayment Agreements. Our legal experts are authorized by the Agency Practice Act to represent Federal Debtors nationwide before SBA, The SBA Office of Hearings and Appeals, Treasury Department, and the Bureau of Fiscal Service. Get in touch today to find out what we can do for you.