Greeneville, TN -- Disaster-aid applicants who are not eligible for a low-interest loan from the U. S. Small Business Administration (SBA) may be eligible for a grant from the Federal Emergency Management Agency's (FEMA) Individual and Family Grant program.
Unlike loans, the FEMA grants of up to $14,400 do not have to be repaid.
After the initial contact with FEMA - by calling the toll-free registration hotline 1-800-462-9029- individuals and business owners who receive an SBA loan packet should complete the forms and return the packet as quickly as possible. In some cases, depending upon the applicant's financial situation, a referral to the Individual and Family Grant program is made immediately.
You can receive face-to-face help in filling out the SBA loan packet at an SBA office near you. Currently, there are two temporary disaster loan assistance offices open to assist individuals and businesses, one located in Greene County at the Greene County Skills Center (formerly Sunnyside Elementary), 490 Sunnyside Road, in Sunnyside, and the other in Shelby County at the North Frayser Community Center, 2555 St. Elmo Street in Memphis.
The hours of operation in Greene County are Monday through Friday, 9:00 a.m. to 6:00 p.m. and Saturday, September 15, 9:00 a.m. to 2:00 p.m. Thereafter, help will be available Monday through Friday, 9:00 a.m. to 6:00 p.m., until further notice.
In Shelby County, the temporary office is open Monday through Friday, 9:00 a.m. to 6:00 p.m. and Saturdays, 9:00 a.m. to 4:00 p.m., until further notice.
Loans are available to residents and businesses of all sizes in the seven counties eligible for federal disaster assistance as a result of President Bush's August 27 disaster declaration. The seven counties eligible for individual disaster assistance are Carter, Cocke, Green, Johnson, Shelby, Unicoi and Washington counties. 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," said Gracia Szczech, the federal official in charge of disaster recovery. Szczech pointed out that applicants should file regardless of pending insurance settlements, which can take longer to process than a loan. In these cases, the home or business owner can use insurance settlements to pay off loan balances. There are no penalties for early repayment of SBA loans.
Under the SBA program, loans of up to $200,000 are available to repair disaster-damaged primary residences. Homeowners and renters also may apply for loans 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. Economic Injury Disaster Loans (working capital) are available to small businesses unable to pay bills or meet expenses because of the disaster.
SBA loans may include amounts for "mitigation techniques" designed to lessen the impact of wind, flood and earthquake damage when a natural disaster strikes. These techniques can range from building a levee to raising a house.
Interest rates on SBA loans currently may be as low as 3.312 percent on home loans or 4.0 percent on business loans, depending on the applicant's financial condition. The lower rate is charged if SBA determines the applicant cannot qualify for a loan at reasonable rates and terms from a non-governmental lender, such as a bank or mortgage company. Since the circumstances of applicants differ, the terms of repayment of the loan - including the interest rate, payment schedule and duration - is determined by the SBA on a case-by-case basis. The maximum term for a loan is 30 years.