Jun. 25—A federal agency is offering below-market interest rates for homeowners, renters and business owners in need of repairs following April tornadoes.
The U.S. Small Business Administration recently announced it will extend disaster relief programs to July 8, which includes homeowners and renters, an agency spokesman told The Transcript on Friday.
Those who qualify must have been impacted by the April 19-20 tornadoes in Oklahoma.
Spokesman Garth MacDonald said most people do not realize the SBA offers assistance to homeowners and renters, or that other aid, including that from from the Federal Emergency Management Agency (FEMA), falls short for repairs.
“FEMA gives grant money for emergency repairs, like a hole in the roof or to keep the house safe and sanitary, but our funds are designed for the longer term to get the home as close to pre-disaster recovery as possible,” he said.
With interest rates climbing to 7% in the last year, the going rate for an SBA loan in Oklahoma is far lower than banks can offer, MacDonald said.
“The home loans that are being approved on the Oklahoma disaster is 2.375%, just like the non-profit rate, and 4% for businesses,” he said.
As of Friday, the agency has approved 98 loans totaling $5.6 million, with 90 of those granted to homeowners or renters totaling $4.4 million.
During a disaster, FEMA and the SBA are joined at the hip, MacDonald said.
“Before FEMA even existed, the SBA has been offering assistance in disasters since the 1950s,” he said. “This is a special program that Congress approved many, many years ago.”
Renters often apply for the loan when insurance for storm damage falls outside their coverage and for which the landlord is not responsible.
“The tenant has private, personal property in there, like a bed, a refrigerator, or maybe their car got hit and it might not be fully covered by insurance,” MacDonald said. “They might not even have had renters insurance for their property. They can borrow up to $40,000 on these low interest rates.”
On a separate program, businesses which did not experience physical damage but sustained the loss of clients due to the storms, can apply for an economic injury loss loan. The loan does not expire until Jan. 2024, he said.
Applications can be completed online at disasterloanassistance.sba.gov or call a customer service representative at 800-659-2955.
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.