What is the SBA Disaster Loan Program?

SBA disaster loan is a low-interest rate with long-term business loans available to business owners, homeowners, and renters who need affordable funding after a declared disaster.

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states can apply for an Economic Injury Disaster Loan.

The EIDL program provides economic relief to businesses currently experiencing a temporary loss of revenue due to COVID-19 or other declared disasters.

In this guide, we dive into the details of Small Business Administration SBA disaster loans, including the different types, who qualifies, and how you can apply for one in your business time of need.

Who can apply for Disaster Loan Program

For-profit, nonprofit, homeowner, and renters located in a declared disaster area and suffered a substantial economic injury are eligible for an SBA Economic Injury Disaster Loan (EIDL) or SBA Disaster Loan Program.

With this type of SBA disaster loan, you can acquire funding to repair or replace your primary residence or other personal property damaged or destroyed in a disaster.

What is the cost of the disaster loan program?

Loan rates are fixed for the complete term of the loan and may vary from disaster to disaster with market conditions. Currently, rates vary from approximately 3% to 6%.

INTEREST RATES

• 3.75% for businesses (fixed).
• 2.75% for nonprofits (fixed).

TERMS

• 30 years
• No pre-payment penalty or fees

COLLATERAL REQUIREMENTS

• Required for loans over $25,000
• SBA uses a general security agreement (UCC) designating business assets as collateral, such as machinery and equipment, furniture and fixtures, etc.

NOTE

If you’ve been impacted by the COVID-19 pandemic, learn more about COVID-19 Loan Programs.