NEW CASTLE, Del. -- Victims of Hurricane Floyd should return their loan applications from the Small Business Administration (SBA) quickly - even if they do not want a loan. Homeowners and renters must send this application back before they can be considered for a grant from the state of Delaware.
Most applicants will receive a packet containing the SBA loan application within two weeks of teleregistration.
"The applications are a bridge to other possible assistance," Steven Adukaitis, federal coordinating officer, said. "If the SBA decides not to offer a loan, the individual will automatically be referred to other available disaster assistance programs."
Interest rates on SBA loans are 3.685 or 4 percent, depending upon whether the applicant is a homeowner or a business. For example, a $10,000 loan for 10 years at the rate of 3.685 percent might have a payment schedule of $104 per month. Because the circumstances of applicants differ, the terms for repayment of the loan?including interest rate, payment schedule and duration?are determined by the SBA on a case-by-case basis. The maximum term for a loan is 30 years.
"Filing an application in no way obligates the applicant to accept a loan," Tom Vendetto, SBA officer, said. "We are urging anyone in New Castle County who has sustained losses because of Hurricane Floyd to file as soon as possible," Vendetto said. "Once an application has been returned, an SBA loss verifier will survey the damages."
The loans are available to residents and businesses of all sizes in New Castle County that were affected by the winds and storm Sept. 15-17. Small businesses located in contiguous counties also may be eligible for certain types of disaster loans.
"The sooner people complete and return loan applications, the sooner financial assistance can be provided," SBA representative Vendetto said. He pointed out that applicants should file regardless of pending insurance settlements, which can take
much longer to process than a loan. In these cases, the home- or business-owners can use insurance settlements to pay off loan balances. There are no penalties for early repayment of SBA loans.
SBA disaster loans cover uninsured or underinsured disaster losses. Under the program, SBA offers loans of up to $200,000 to repair disaster-damaged primary residences. Homeowners and renters are eligible for up to $40,000 to replace personal property such as furniture, automobiles, clothing and other household fixtures.
Loans to businesses and non-profit organizations of up to $1.5 million are available to repair damage to real estate, machinery, and equipment and inventory. Small businesses that did not sustain any physical damage, but that are unable to pay bills or meet expenses because of the effects of the disaster, may also be able to get loans.
SBA loan applications are available at the FEMA/state Disaster Recovery Center. People who need additional information regarding other disaster assistance programs are urged to call FEMA's toll-free Helpline at 1-800-525-0321. People with hearing- or speech-impairments may call the TTY Helpline at 1-800-462-7585.