Getting a SBA Home or Personal Property Loan After a Natural Disaster

If a natural disaster has damaged your home or personal property, you might be able to get a loan from the SBA to cover the costs of repairs or replacement.

If you've been affected by a natural disaster—like a hurricane, wildfire, or mudslide—you might qualify to get a loan from the U.S. Small Business Administration (SBA), even if you don't have a small business.

Read on to learn more about SBA loans for homeowners and renters, get details about how much you might be able to borrow, and learn about the application process. (To get general information about SBA loans and learn about other SBA programs for people who’ve gone through a natural disaster, see Getting an SBA Loan After a Natural Disaster.)

Getting an SBA Loan to Repair Your Home or Replace Your Belongings

Homeowners and renters whose property was damaged as a result of a declared disaster may apply for a low-interest SBA disaster loan. If you qualify, you can use the loan proceeds to fix your damaged home, or to repair or replace your personal belongings after a natural disaster.

Loans to fix your home. Homeowners may apply for up to $200,000 to restore their primary residence to its pre-disaster condition. The total amount of the loan you may get depends on the cost to repair your home, less any insurance settlements or grants. Though, you might qualify for up to 20% more money if you agree to make improvements to the real estate that would reduce the risk of property damage in the future from the same type of disaster.

Loans to repair or replace personal property. Eligible homeowners and renters can borrow up to $40,000 to repair or replace personal property that was damaged or destroyed in a natural disaster.

Qualifying for a SBA Home and Personal Property Loan

Here are the eligibility rules, loan terms, and permissible uses for SBA home and personal property loans.

Eligibility

Home and personal property disaster loans are available to cover damage to a primary home—and its contents—but not second homes or vacation properties. Qualified rental properties, though, might be eligible for a loan under the SBA business loan programs.

Loan Terms

The interest rate on an SBA home or personal property disaster loan will not be more than:

  • 4% for applicants who are unable to obtain credit elsewhere, or
  • 8% for those who are able to obtain credit elsewhere, like from a bank. (The SBA determines whether an applicant has credit available elsewhere).

The repayment period of the loan can be up to 30 years, which is determined on an individual basis and is based upon the borrower’s repayment ability.

A borrower has to provide collateral for loans over $25,000, which usually consists of a first or second mortgage on the damaged real estate. The SBA will not deny a loan for insufficient collateral, but it will require the borrower to provide whatever collateral they can. (Learn about foreclosure of SBA disaster loans.)

Acceptable Uses of Loan Proceeds

You may use loan proceeds to repair or replace a primary residence, as well as repair or replace clothing, furniture, cars, or appliances damaged or destroyed in the disaster. You can’t use the loan to upgrade your home or make additions, unless such upgrades and additions are required by local building codes or the improvements help prevent future damage from a similar disaster.

In some cases, the SBA can refinance all or part of an existing mortgage if you don't have credit available elsewhere and have suffered substantial disaster damage not covered by insurance.

How to Apply for a SBA Disaster Loan

To apply for a SBA disaster loan, go to the SBA website and click on “Apply Online.” If you prefer not to submit your application over the Internet, you may apply in person at any Disaster Recovery Center where you can also get personal, one-on-one help from an SBA representative. You also have the option of submitting a loan application through the mail.

To learn more about SBA home and personal property loans, go to the SBA website and click on "Home and Personal Property Loans."

Getting Additional Help

People who’ve gone through a natural disaster might also qualify for help from the Federal Emergency Management Agency (FEMA). Learn about different types of FEMA assistance and whether you qualify at DisasterAssistance.gov’s “Find Assistance” website.

If you’re struggling to make your existing mortgage payments—or you’ve already fallen behind in payments—after a natural disaster, you can learn about foreclosure relief in Help for Homeowners Facing Foreclosure After a Natural Disaster: Foreclosure Moratoriums.

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