Home and Property Disaster Loan Program Benefits

The U.S. Small Business Administration (SBA) is responsible for providing affordable, timely and accessible financial assistance to homeowners and renters located in a declared disaster area. Financial assistance is available in the form of low-interest, long-term loans for losses that are not fully covered by insurance or other recoveries.

Homeowners may be eligible for up to $200,000 to repair or replace their primary residence that was damaged or destroyed in a declared disaster event. In some cases, SBA may be able to refinance all or part of a previous mortgage (not to exceed $200,000) when the applicant does not have credit available elsewhere, has suffered substantial disaster damage not covered by insurance, and intends to repair the damage. 

SBA considers refinancing when processing each application. Loans may also be increased by as much as 20 percent of the verified losses (not to exceed $200,000) to mitigate damages from possible future disasters. Secondary homes or vacation properties are not eligible for home disaster loans; however, qualified rental properties may be eligible for assistance under the business disaster loan program.

Renters and homeowners may borrow up to $40,000 to replace damaged or destroyed personal property such as clothing, furniture, appliances, automobiles, etc. This loan may not be used to replace extraordinarily expensive or irreplaceable items, such as antiques, collections, pleasure boats, recreational vehicles, fur coats, etc.

Home and Personal Property Loans

If you are in a declared disaster area and have experienced damage to your home or personal property, you may be eligible for financial assistance from the SBA — even if you do not own a business. As a homeowner, renter and/or personal property owner, you may apply to the SBA for a loan to help you recover from a disaster.

Loan Amounts and Use

Homeowners may apply for up to $200,000($500,000 for Disasters declared on or after July 31st) to replace or repair their primary residence. The loans may not be used to upgrade homes or make additions, unless required by local building code. If you make improvements that help prevent the risk of future property damage caused by a similar disaster, you may be eligible for up to a 20 percent loan amount increase above the real estate damage, as verified by the SBA.

In some cases, SBA can refinance all or part of a previous mortgage when the applicant does not have credit available elsewhere and has suffered substantial disaster damage not covered by insurance. Renters and homeowners may borrow up to $40,000($100,000 for Disasters declared on or after July 31st) to replace or repair personal property — such as clothing, furniture, cars and appliances — damaged or destroyed in a disaster.

Home Rehabilitation Mortgage Insurance Program Benefits

Home and Property Disaster Loan Program

Here are some key points about the SBA's Home and Property Disaster Loan program:

  • Eligibility: Homeowners, renters, businesses, and nonprofit organizations located in a declared disaster area are typically eligible to apply for these loans.
  • Loan Types: SBA offers different types of disaster loans, including Home and Personal Property Loans for homeowners and renters, and Business Physical Disaster Loans for businesses of all sizes.
  • Loan Uses: The funds from these loans can be used to repair or replace damaged or destroyed real estate, personal property, machinery and equipment, inventory, and business assets.
  • Interest Rates: The interest rates for these loans are generally lower than those available through other financial institutions. The rates are designed to be affordable for disaster survivors.
  • Application Process: Applicants typically apply directly through the SBA. The application process involves submitting necessary documentation and information about the damages incurred.
  • Collateral and Repayment: While homeowners and renters do not need to provide collateral for loans up to a certain amount, businesses may be required to pledge collateral. Repayment terms are based on the borrower's ability to repay the loan.

It's important to note that program details may evolve, and new information may have become available since my last update. Therefore, for the most current and specific information about the Home and Property Disaster Loan program, I recommend checking the official website of the U.S. Small Business Administration or contacting them directly.

Eligibility and Terms

Secondary homes or vacation properties are not eligible for these loans. However, qualified rental properties may be eligible for assistance under the SBA business disaster loan program. Proceeds from insurance coverage on your home or property will be deducted from the total damage estimate to determine the eligible loan amount. The SBA is not permitted to duplicate any benefits.

For applicants unable to obtain credit elsewhere, the interest rate will not exceed 4 percent. For those who can obtain credit elsewhere, the interest rate will not exceed 8 percent. The SBA will determine whether an applicant can obtain credit elsewhere. SBA disaster loans are offered with up to 30-year terms.

In a Presidential declaration, home loans for more than $25,000 must be secured with collateral to the extent possible. For Agency declarations, home loans for more than $14,000 must be secured with collateral to the extent possible. The SBA will ask the applicant for available collateral, but will not decline a loan for lack of collateral. A first or second mortgage on the damaged real estate is commonly used as collateral for an SBA disaster loan.

Home Mortgage Insurance for Disaster Victims Program

Who is eligible for Home and Property Disaster Loans?

In order to qualify for this benefit program, homeowners and renters must have sustained physical damage and be located in a disaster declared area. Credit Requirements: SBA's assistance is in the form of loans, as such SBA must have a reasonable assurance that such loans can and will be repaid based on satisfactory credit and repayment ability.

Collateral Requirements: Collateral is required for all home disaster loans over $25,000, to the extent it is available. Real estate is the preferred form of collateral. SBA will not decline a loan for lack of collateral, but SBA will require the borrower to pledge collateral if it is available.

What are the loan terms for Home and Property Disaster Loans?

Disaster survivors must repay SBA disaster loans. SBA can only approve loans to applicants with a reasonable ability to repay the loan and other obligations. The terms of each loan are established in accordance with each borrower's ability to repay. The law gives the SBA several powerful tools to make disaster loans affordable: low fixed interest rates, long-terms (up to 30 years), and refinancing of prior real estate liens (in some cases). 

As required by law, the interest rate for each loan is based on SBA's determination of whether an applicant has credit available elsewhere and can fund their own recovery without incurring a financial hardship. The SBA can provide up to $200,000 to homeowners to repair or replace their primary residence. Homeowners and renters are eligible for up to $40,000 to help repair or replace personal property. There are no upfront fees or early payment penalties charged by SBA.

Max Loan Length30 years
Interest RateCannot exceed 4% if no credit elsewhere. Cannot exceed 8% if credit available elsewhere
Max Loan Amount$200,000 for real estate, $40,000 for personal property
Payment FrequencyMonthly
Prepayment PenaltiesNo
Max Loan LengthNo

Home and Property Disaster Loan Application Form PDF

How To Apply For Home and Property Disaster Loan Program?

You can apply online for an SBA disaster assistance loan. SBA will send an inspector to estimate the cost of your damage once you have completed and returned your loan application. You must submit the completed loan application and a signed and dated IRS Form 4506-C giving permission for the IRS to provide SBA your tax return information.

For additional information, please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 (If you are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services) or e-mail [email protected].

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How do I apply for Home and Property Disaster Loans?

Apply online for disaster loan assistance at your own convenience through SBA's secure Disaster Loan Assistance website. For application information, please call 1-800-659-2955 or email Disaster [email protected]

How can I contact someone?

For more information about the program or questions on how to apply, please visit the Disaster Loan Assistance site. Or contact the program at: 1-800-659-2955 OR [email protected] / 1-800-659-2955.

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