Disaster can strike at any time and can have catastrophic effects. Unfortunately, insurance will not be able to cover all of the costs that are associated with rebuilding a business after a major disaster. Luckily, there are a number of places where businesses can turn to seek out assistance in these difficult times.
Small Business Administration
The Small Business Administration is our government agency whose sole purpose is to help support small businesses and entrepreneurs and be a resource in times of disaster. Through the SBA, businesses are able to get loans that are through partner banks and credit unions.
SBA Disaster Loan Types
Depending on the type of disaster, there are a number of different loans that are available through the SBA. The first that is specifically for businesses would be the Business Physical Disaster Loan. This is used when a business is damaged and is in a declared disaster zone. The loan is used to repair the property and get it to the status it was in before the disaster. A qualified business can get up to two million dollars with this loan.
An Economic Injury Disaster Loan is when there are economic implications that have resulted because of the particular disaster. As with others, this loan will be based on the specific needs of the business. The Economic Loan is only available for businesses that are unable to get credit from another source.
Finally, the Military Reservist Economic Injury Disaster Loan is utilized by those businesses that are having difficulty meeting their expenses due to a necessary employee being called into active duty with the military reserves.
SBA Disaster Assistance Loan Application
To apply for a Disaster Assistance Loan through the SBA, the business owner must promise his available assets and his spouse must do the same if assets are shared. If the debt is defaulted upon, the value of their assets must be surrendered. The application process can easily be done online, or the form can be mailed in to the SBA. There are also local offices where the application can be done in person. There is at least one office in each state.
The business owner will need to provide information such as current contact information, identification such as social security numbers and EIN numbers and applicable insurance information. The normal turn around time for approval is approximately two weeks, but could be longer in the case of widespread disasters.
FEMA Business Disaster Assistance
The Federal Emergency Management Agency (FEMA) offers Disaster Assistance, by way of grants, when funds from other sources are not fully sufficient to cover costs. To apply for Assistance through FEMA, the business has to have already gone through the SBA and accepted all other forms of assistance. Applying is similar to the SBA process and is done online, in person at a local office, or the application can be mailed in for processing.
In addition to property damage, there are other areas where businesses may need support. FEMA offers several programs during times of disaster. These include Crisis Counseling Assistance, Disaster Unemployment Services, and various legal services.
There are actually many resources that are available for the small business owner when disaster strikes. The Small Business Administration and Federal Emergency Management Agency offer them the opportunity to rebuild and get the operation back to its previous glory. Contact a nearby office to get more information or to start the application process.
A financial counselor from Brighton, Sarah McDonald also contributes content for Finance Choices, a UK credit card comparison site where you can compare balance transfer credit cards for special deals when switching card companies.
