Big Island Businesses, Nonprofits: ‘Low-Interest Disaster Loans Are Smart Business’

Businesses and nonprofit organizations on the Big Island are finding that applying for a low-interest disaster loan from the U.S. Small Business Administration can be a smart business decision.

Disaster loans provide funding for business owners (including landlords) and private nonprofit
organizations with their recovery and are being used to:

• Repair or replace disaster damaged or destroyed property and business assets, such as equipment
  and inventory;
• Economic Injury (working capital) loans to meet payroll and lease obligations during business
  downtime caused by the disaster;
• Fund improvements to protect against future damage.

“Disaster loans from the SBA are the major source of federal disaster recovery assistance,” said Federal Coordinating Officer Bern Ruiz of the Federal Emergency Management Agency. “The interest rates are low—as low as 3.610% for businesses and 2.5% for nonprofits.”

SBA offers businesses and nonprofits two types of disaster loans: a Physical Disaster Loan and an
Economic Injury Disaster Loan.

Physical Disaster Loans are used to repair or replace damaged buildings and business assets.

Economic Injury Disaster Loans help small businesses, small agricultural cooperatives, aquaculture businesses and most private nonprofits meet financial obligations that they cannot meet because of the disaster.

SBA low-interest disaster loans for businesses have several advantages:

• Applicants do not have to wait for insurance settlements to obtain loans.
• Low interest disaster loans can provide up to $2 million dollars with terms up to 30 years.
• SBA offers mitigation loans to help pay for improvements to reduce potential for future damage.
  These mitigation funds are available for up to 20 percent of the total amount of disaster damage.
• SBA never charges an application fee or points for its disaster loans.
  The deadline to apply for a Physical Damage Disaster Loan is Aug. 13, 2018. The deadline to apply for
  an Economic Injury Disaster Loan is March 14, 2019.

No one is obligated to accept a loan if approved. If the SBA is unable to provide a loan, applicants have within six months to request reconsideration.

To apply for SBA low-interest disaster loans, business owners, private nonprofits, homeowners and
renters can visit the disaster recovery center for one-on-one assistance, or apply online using SBA’s
secure website.

An important step in the recovery process is to register for assistance with FEMA. FEMA and SBA are
joint federal partners in Hawai‘i’s recovery efforts.

For additional information on FEMA programs and how to register for assistance, go online.