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Tuesday, 03 June 2014 16:12

An SBA Disaster Loan Can Be Smart Business

JACKSON, MS. — Survivors may not know about disaster help from the U.S. Small Business Administration that could lead to a smarter, faster recovery for businesses, homeowners, renters or private nonprofits.

Economic Injury Disaster Loan

SBA offers a working capital loan to relieve the economic injury caused by the disaster. A disaster loan is available to eligible businesses as well as private nonprofits even if property was not damaged by the severe storms, tornadoes and flooding that occurred April 28 thru May 3, 2014. 

These loans are for small businesses, small agricultural cooperatives, small businesses engaged in aquaculture and certain private, nonprofit organizations of all sizes to cover unpaid bills and lost business due to the disaster. Economic Injury Disaster Loans are also given in amounts up to $2 million, but the total of both physical damage and economic injury loans cannot exceed $2 million. Economic Injury Disaster Loan assistance is available regardless of whether the business suffered any physical property damage.

There are 45 Mississippi counties eligible for Economic Injury Disaster Loans. The first 12 counties are those designated by the presidential disaster declaration for FEMA Individual Assistance.  Those counties are Itawamba, Jones, Leake, Lee, Lowndes, Madison, Montgomery, Rankin, Simpson, Warren, Wayne and Winston. 

Thirty-three other counties are eligible because each shares a border with one of the 12 disaster-designated counties. These additional counties eligible only for an Economic Injury Disaster Loan are Attala, Carroll, Chickasaw, Choctaw, Claiborne, Clarke, Clay, Copiah, Covington, Forrest, Greene, Grenada, Hinds, Holmes, Issaquena, Jasper, Jefferson Davis, Kemper, Lawrence, Monroe, Neshoba, Newton, Noxubee, Oktibbeha, Perry, Pontotoc, Prentiss, Scott, Smith, Tishomingo, Union, Webster and Yazoo in Mississippi. 

Physical Damage Disaster Loans

Businesses and private non-profit organizations of any size may borrow up to $2 million to repair or replace disaster damaged or destroyed real estate, machinery and equipment, inventory and other business assets. The SBA may increase a loan up to 20 percent of the total amount of disaster damage to real estate and/or leasehold improvements, as verified by SBA, to make improvements that lessen the risk of property damage by future disasters of the same kind. 

Interest rates are as low as 4 percent for businesses, 2.625 percent for non-profit organizations and
2.188 percent for homeowners and renters with terms up to 30 years. Loan amounts and terms are set by the SBA and are based on each applicant’s financial condition. 

Deferred Disaster Loan Payments

The first payment for a disaster loan is due five months from the date of the SBA Note.

The deadline to apply for an SBA Physical damage loan is June 30, 2014, and for Economic Injury Disaster Loans the deadline is January 30, 2015. 

A simple and fast way to complete the application is online, using the SBA’s electronic loan application.  Go to https://DisasterLoan.SBA.gov/ELA. Plus, you can receive a status of your application by calling 800-659-2955 or TTY 800-877-8339, emailing This email address is being protected from spambots. You need JavaScript enabled to view it. or visiting sba.gov/disaster. SBA customer service representatives are available at ALL disaster recovery centers. Disaster recovery center locations can be found online at FEMA.gov/DRCLocator or by calling      800-621-3362 (TTY 462-7585.)                          

Do not wait on an insurance settlement before returning an application. Insurance may not pay for all of the disaster-related damage. Survivors can begin their recovery immediately with an SBA disaster loan. The loan balance will be reduced by the insurance settlement.

For more information on Mississippi disaster recovery, click fema.gov/disaster/4175. Visit the MEMA site at msema.org or on Facebook at facebook.com/msemaorg.

FEMA’s mission is to support our citizens and first responders to ensure that as a nation we work together to build, sustain, and improve our capability to prepare for, protect against, respond to, recover from, and mitigate all hazards.

Disaster recovery assistance is available without regard to race, color, religion, nationality, sex, age, disability, English proficiency or economic status. If you or someone you know has been discriminated against, call FEMA toll-free at 800-621-FEMA (3362). For TTY call 800-462-7585.

FEMA’s temporary housing assistance and grants for public transportation expenses, medical and dental expenses, and funeral and burial expenses do not require individuals to apply for an SBA loan. However, applicants who receive SBA home loan applications must submit them to SBA loan officers to be eligible for assistance that covers personal property, vehicle repair or replacement, and moving and storage expenses.