The U.S. Small Business Administration (SBA) has announced the availability of low-interest disaster loans for businesses and residents in Pennsylvania following a Presidential disaster declaration due to damage caused by Tropical Storm Debby on August 9-10.
This significant disaster declaration allows eligible individuals and businesses within designated counties to apply for crucial financial assistance aimed at recovery and rebuilding efforts.
Affected Areas
The disaster declaration specifically addresses the counties of Lycoming, Potter, Tioga, and Union, granting access to both Physical and Economic Injury Disaster Loans (EIDLs). Additionally, adjacent counties, including Bradford, Cameron, Centre, Clinton, Columbia, McKean, Mifflin, Montour, Northumberland, Snyder, and Sullivan in Pennsylvania, along with Allegany, Chemung, and Steuben in New York, are eligible only for SBA Economic Injury Disaster Loans.
Types of Loans Available
The SBA is providing several types of disaster loans, including:
- Businesses and Nonprofits: Businesses and private nonprofit organizations can borrow up to $2 million to repair or replace real estate, machinery, equipment, inventory, and assets that were damaged or destroyed by the disaster.
- Small Businesses: Small businesses, agricultural cooperatives, aquaculture enterprises, and the majority of private nonprofit organizations may also qualify for EIDLs to cover working capital needs stemming from the disaster, regardless of physical property damage.
- Homeowners and Renters: Homeowners can access disaster loans of up to $500,000 for repairing or replacing damaged or destroyed real estate. Additionally, homeowners and renters may borrow up to $100,000 to repair or replace personal property lost in the storm.
Loan Terms and Conditions
Interest rates are as low as 4% for businesses, 3.25% for nonprofit organizations, and 2.813% for homeowners and renters, with loan terms potentially extending up to 30 years based on the borrower’s financial circumstances. Importantly, interest does not accrue and no monthly payments are required for the first 12 months after loan disbursement.
The SBA determines loan amounts and terms based on the applicant’s financial situation, aiming to aid in long-term recovery by restoring properties to their pre-disaster state.
Additional Loan Benefits for Mitigation
In addition to repairing damages, the SBA disaster loan program provides an opportunity for applicants to incorporate mitigation improvements to help prevent future losses. Eligible applicants may receive a loan amount increase of up to 20% of verified physical damages, which can be used for projects such as safe rooms, storm shelters, sump pumps, French drains, or retaining walls.
Application Process and Deadlines
Disaster survivors are strongly encouraged to apply for an SBA disaster loan, even if they have not settled with their insurance provider. The SBA can lend for total losses up to its limits, conditional on using insurance proceeds to repay the loan. To maximize recovery efforts, survivors should also consider applying for FEMA grants, which cover essential expenses not addressed by insurance or other resources, while SBA loans focus on long-term recovery.
Applications for physical property damage must be submitted by November 12, 2024, while the deadline for economic injury applications is June 11, 2025.
For more information regarding the SBA disaster loan program or to apply, visit the official SBA website. For assistance, individuals can contact the SBA Customer Service Center directly. Services are available for individuals with hearing disabilities through relay services.
