Small Business Administration (SBA) Disaster Assistance

The SBA provides low-interest, long-term loans to homeowners, renters, businesses and private, non-profit organizations to repair or replace real estate, personal property, machinery and equipment, inventory and business assets that have been damaged or destroyed in a Presidential declared disaster.

Five Situations for SBA Disaster Loans

SBA publishes notice of any disaster declaration in the Federal Register. The published notice will identify available assistance, the date, nature of the disaster, location for filing loan applications and the deadline. Policy is subject to change.

Presidential Declaration: Individual Assistance

The President declares a major disaster or declares an emergency and authorizes federal assistance, including individual assistance.

Presidential Declaration: Public Assistance Only

If the President declares a major disaster limited to public assistance only, a private non-profit facility (which provides non-critical services under guidelines of FEMA) must first apply to SBA for disaster loan assistance before it could seek grant assistance from FEMA.

Physical Disaster Declaration

The SBA makes a physical disaster declaration, based on the occurrence of at least a minimum amount of physical damage to buildings, machinery, equipment, inventory, homes and other property. Such damage usually must meet the following:

• In any county or other smaller political subdivision of a state or U.S. possession, at least 25 homes or 25 businesses, or a combination of at least 25 homes, businesses or other eligible institutions, each sustain uninsured losses of 40% or more of the estimated fair replacement value or pre-disaster fair market value of the damaged property, whichever is lower; 

or

• In any such political subdivision, at least three businesses each sustain uninsured losses of 40% or more of the estimated fair replacement value or pre-disaster fair market value of the damaged property, whichever is lower, and, as a direct result of such physical damage, 25% or more of the work force in their community would be unemployed for at least 90 days.

Economic Injury Disaster Declaration: Secretary of Agriculture

SBA makes an economic injury disaster declaration in response to a determination of a natural disaster by the Secretary of Agriculture.

Economic Injury Declaration: State Certification

SBA makes an economic injury declaration in reliance on a state certification that at least five small business concerns in a disaster area have suffered substantial economic injury as a result of the disaster and are in need of financial assistance not otherwise available on reasonable terms. The state certification must be signed by the Governor, must specify the county or counties or other political subdivision in which the disaster occurred, and must be delivered with supporting documentation to the Disaster Assistance Field Operations Center serving the jurisdiction within 120 days of the disaster occurrence.

SBA Disaster Loan Resources

• SBA Disaster Loan FAQ
• Disaster Loan Program: Code of Federal Regulations
• How are Disaster Declarations Made?