SBA to provide business loans after hurricane until mid-2018
SAN JUAN – The Small Business Administration has already approved more than $16 million in loans for businesses, homeowners and renters in Puerto Rico and will continue to accept requests for assistance until mid-2018.
SBA spokesman Florencio Marina said Wednesday that businesses can request loans to pay for physical and economic damages. Businesses have until March 20 to apply for loans to pay for physical damages to structures. To cover economic damages, companies will have until June 20 to apply.
Applicants must first apply to the Federal Emergency Management Agency (FEMA) for aid before requesting assistance from the SBA. In addition, applicants must have good credit history and demonstrate ability to pay. Applicants seeking loans to pay for physical damages to their businesses should have a collateral worth $25,000 to guarantee the loan, but the SBA will not reject a loan for not having collateral as long as the applicant has other assets available.
“Businesses can request up to two types of loan assistance of up to $2 million at a 3.3% interest rate,” he said.
Marina had no information on how much of the $16 million was funneled to small businesses. However, he expects the amount to increase.
When asked whether SBA loans can be used to install renewable energy equipment to mitigate the loss of electricity, Marina said mitigation grants are also offered.
The SBA also has disaster loans for homeowners. These are limited by SBA regulations to a maximum of $200,000 to repair or replace real estate property and $40,000 to repair or replace personal property. Subject to these maximum amounts, the loan may not exceed the amount of damages for disasters verified and uninsured.
Applicants who have previously failed to meet their obligations with SBA assistance loans are not eligible. These include borrowers who have not fulfilled their obligation to buy flood or fire insurance on previous SBA loans or loans insured by the federal government.
If the loan application is approved, the applicant may be eligible for additional funds to cover the cost of improvements to protect the property from future damages.
The SBA also has provided loans for refinancing and relocation expenses.