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- On February 28, 2016
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Homeowners and renters who live in declared disaster areas have to deal with the losses occasioned by unpredictable disasters. The U.S. Small Business Administration provides timely, affordable and accessible financial assistance to these homeowners and renters, to enable them make recovery after a disaster. This financial assistance is available in the form of low-interest, long-term loans that cater to losses that are not fully covered by insurance or other recoveries.
For the homeowners, the amount requested can only go up to $200,000, and can be used to repair or replace the primary residence to its pre-disaster condition. The funds obtained cannot be used to upgrade the home or make additions to it.
In particular cases, the SBA will finance all or part of a previous mortgage (not exceeding $200,000) when the applicant:
- does not have credit available elsewhere
- has suffered substantial disaster damage not covered by insurance
- intends to repair the damage
Refinancing is considered when processing each application. Once the losses are verified, the loan amount may be increased by as much as 20 percent, although it should not exceed $200,000. This increase is made so as to enable the applicant to protect the damaged real property from possible future disasters that are of the same kind. Secondary homes and vacation properties cannot receive financial assistance under the Home and Property Disaster Loans program. For rental properties, upon qualification, loans may be obtained through the business disaster loan program.
Renters and homeowners who are eligible may borrow up to $40,000 to replace damaged personal property. Clothing, appliances, furniture, automobiles etc. are considered personal property, together with anything else that is not considered real estate or part of the actual structure. The funds obtained from the home and property loans cannot be used to replace any items that are categorized as extraordinarily expensive or irreplaceable. These include antiques, fur coats, and recreational vehicles and so on.
If you are wondering whether you qualify for this loan, the requirements are, the homeowners and renters must have sustained physical damage and be located in a declared disaster area.
Once you obtain the loan, you are required to repay it. As such, SBA will only approve your loan if you demonstrate an ability to repay it through your earnings. The terms of each loan are set forward based on each borrower’s ability to pay. The loans have low fixed interest rates, long terms and even allow for refinancing of real estate liens, in some cases.
If you have suffered damage and losses because of a disaster, inadequate insurance or insufficient savings can make recovery very difficult.
If you do not qualify for the Home and Property Disaster Loans program or need funds immediately and cannot manage a lengthy application and approval process, other business lending solutions are available. At National Business Helpers, we offer a fast business loan approval process that offers small and midsize companies a range of unrestricted financing options with minimal paperwork. If you are looking for an alternative to bad credit business loans with cash advance options, secured loans and term loans with competitive rates and attractive terms you have come to the right place.