What is an SBA Disaster Loan?
The SBA Disaster loans are ideal for businesses that have been impacted negatively by a disaster & is able to prove with solid evidence that the business was negatively impacted. There are multiple SBA Disaster loans to choose from, also you can apply for each one at the same time if needed. Below we’ll go over the types of SBA disaster loans & how they work.
Why are there 3 types of SBA Disaster Loans?
The reason is that these loans provide borrowers with an extra source of what’s called “gap funding” when other sources like insurance have been exhausted. So businesses of all sizes & some private non-profit organizations that meet the minimum requirements such as a credit score of at least 660 & the ability to repay are eligible to apply for funding up to $2 million.
1.SBA Business Physical Disaster Loan
The SBA Business Physical Disaster Loan is a long term loan designed to assist businesses that suffered physical losses & damages due to a declared disaster that’s not covered by insurance up to $2 million. This type of loan virtually comes with low rates & one of the eligibility requirements that your business has been physically damaged by a disaster that is in a declared disaster area.
2.SBA Economic Injury Disaster Loans
The SBA Economic Injury Disaster Loan is for businesses that have suffered an economic injury as a result of a disaster & you are unable to meet your normal working expenses. This type of loan is short to a medium-term loan with a low-interest rate depending on the damage.
3.SBA Military Reservists Economic Injury Loans
The SBA Military Reservists Economic Injury Loan similar to the (EIDL) is also short to a medium-term loan with a low-interest rate depending on the damage. It was created to assist businesses that lose an employee due to being called for active military service & the loss results in an inability to meet normal operating expenses.
A Look at the SBA Disaster Loan Interest Rates & Terms
- Business Physical Disaster loan rates: 4% to 8%
- Economic Injury Disaster loan rates: 4%
- Military Reservist Economic Injury loan rates: 4%
How do you qualify for an SBA Disaster Loan?
In order to qualify for an SBA Disaster Loan you will need a credit score of a minimum 680 or more along with a strong repayment ability, also depending on the scenario some collateral would be ideal. In addition to this, you will need to meet the standard SBA approval requirement of being a small for-profit business that is based in the United States.
Now that you have enough information on the three types of SBA Disaster Loans, deciding which one to go with should be easier for you to pick from. If after reviewing everything you feel this might not be the best fit for you we do have more than enough funding options for you to choose from. Just visit Uplyftcapital.com and fill out our free application to get the best option for your business.