Numerous places are trying hard to get more low interest Small Business Administration loans out there. This cash till payday product has been promised to homeowners and business owners to help rebuild after emergencies. The quick loan solution has about 4 to 6 percent interest and the SBA offers it for floods, fires, and even oil spills just lately.
SBA loans purpose
For “everyday use” small businesses use SBA loans to build and develop. Loans are guaranteed with the SBA. It does not offer loans online but instead works with banks to provide loans. The SBA also offers disaster loans for those who have had to endure a disaster. Being able to pay back an SBA loan is considered with credit when applying for one. Those who “are having a difficulty accessing other credit” are the ones who qualify for SBA loans.
Denial rates for emergency cash loans
SBA emergency cash loans are often initiated or offered very soon after an emergency hits. SBA loans up to $200,000 are given to those in Massachusetts to rebuild from the flood. Businesses can be able to take out loans of up to $2 million, with interest rates as low as 2.75 percent. Of course, BP has to pay for damages before the SBA will accept application which is why 70 percent of applicants in Louisiana were denied. The flood caused many to need a loan in Tennessee, but SBA denied about 66 percent of those applicants also.
Appeal decisions
Many are frustrated with being unable to rebuild after being denied the loan. Since individuals can’t even access their credit, the SBA program can’t help anybody. The SBA does have an appeal process that allows applicants to provide new details, show proof of altered circumstances or correct information in the original applications. In the end, though, these loans usually end up going to individuals who show proof they can repay them — and that could be very tough to show after a disaster and within the tough economy.
Additional reading
Tennessean
tennessean.com/article/20100729/BUSINESS01/7290344/SBA-denies-most-loans-for-flood-damaged-businesses
Boston.com
boston.com/yourtown/news/somerville/2010/07/fed_agency_to_offer_low-intere.html
