PA businesses can now apply for disaster loans
The U.S. Small Business Administration (SBA) implemented its disaster declaration for Pennsylvania so small businesses and private non-profits statewide can access SBA Economic Injury Disaster Loans to help alleviate economic injury caused by the coronavirus (COVID-19).
The loans may be used to pay fixed debts, payroll, accounts payable, and other bills that can’t be paid because of the disaster’s impact. The loans offer up to $2 million in assistance for each affected small business. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.
SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
The loans also are available to small agricultural cooperatives and small aquaculture businesses.
Applicants may apply online using the Electronic Loan Application via SBA’s secure website at https://disasterloan.sba.gov/ela. To prepare for the online application, businesses are also encouraged to review the SBA Disaster Business Loan Application forms at https://disasterloan.sba.gov/ela/Information/PaperForms. Paper loan applications can be downloaded from www.sba.gov/disaster. Completed applications should be mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.
Disaster loan information and application forms may also be obtained by calling the SBA’s Customer Service Center at 800-659-2955 (TTY: 800-877-8339) or emailing firstname.lastname@example.org.
SBA’s partners can offer free assistance with reconstructing financial records, preparing financial statements and submitting the loan application. Partners include Small Business Development Centers (SBDCs), SCORE, Women’s Business Centers (WBC), and Veteran’s Business Outreach Centers, and local Chambers of Commerce. For the nearest offices, visit: https://www.sba.gov/local-assistance
SEDA-Council of Governments (SEDA-COG) can help direct and offer guidance to central Pennsylvania businesses. Please contact Doug Wilburn, director of Business Finance, at 570-524-4491 or email@example.com.
Businesses may also contact their local county resources, as well as the Pennsylvania Department of Community and Economic Development’s Pennsylvania Business One-Stop Shop at firstname.lastname@example.org or call 1-833-722-6778, option 0.
These SBA loans now have relaxed criteria as part of the Trump Administration’s aggressive, whole-of-government efforts to combat the coronavirus outbreak (COVID-19) and minimize economic disruption to the nation’s 30 million small businesses.
The relaxed criteria will have two immediate impacts:
• Faster, Easier Qualification Process for States Seeking SBA Disaster Assistance. Historically, the SBA has required that any state or territory impacted by disaster provide documentation certifying that at least five small businesses have suffered substantial economic injury as a result of a disaster, with at least one business located in each declared county/parish. Under the just-released, revised criteria, states or territories are only required to certify that at least five small businesses within the state/territory have suffered substantial economic injury, regardless of where those businesses are located.
• Expanded, Statewide Access to SBA Disaster Assistance Loans for Small Businesses. SBA disaster assistance loans are typically only available to small businesses within counties identified as disaster areas by a Governor. Under the revised criteria issued today, disaster assistance loans will be available statewide following an economic injury declaration. This will apply to current and future disaster assistance declarations related to coronavirus.
“We’re very encouraged that banks and financial institutions are responding to the President’s efforts to mobilize an unprecedented public-private response to the Coronavirus (COVID-19) outbreak. As a result, most small businesses that need credit during these uncertain times will be able to obtain it. However, our goal is to ensure that credit is available to any and all small businesses that need credit but are unable to access it on reasonable terms through traditional lending channels,” said Administrator Carranza. “To that end, the SBA is relaxing the criteria through which states or territories may formally request an economic injury declaration, effective immediately. Furthermore, once an economic injury declaration has been made in a state or territory, the new rules allow the affected small businesses within the state or territory to apply for a disaster assistance loan.”
SBA’s Economic Injury Disaster Loans are just one piece of the expanded focus of the federal government’s coordinated response, and the SBA is strongly committed to providing the most effective and customer-focused response possible.