SBA Offers Financial Assistance for Businesses & Homeowners Damaged by Tropical Storm Ernesto - Southern Maryland Headline News

SBA Offers Financial Assistance for Businesses & Homeowners Damaged by Tropical Storm Ernesto

PRINCE FREDERICK, Md. - September 19, 2006 - Luckily, Tropical Storm Ernesto blew through Southern Maryland Labor Day weekend without the ferocity of some storms that rocked the region in the past, but it left damage in its wake nonetheless. In fact, on September 18, 2006, the Small Business Administration (SBA) designated Calvert, St. Mary's and Charles Counties as disaster areas, thus creating the opportunity for businesses and homeowners in these counties to qualify for low-interest physical disaster and economic injury loans to assist with clean up, repair and restoration.

Details of the loan programs come from the SBA and include the following:

What Types of Disaster Loans are Available?

* Home Disaster Loans - Loans to homeowners or renters to repair or replace disaster-damaged real estate or personal property owned by the victim. Renters are eligible for their personal property losses, including automobiles.

* Business Physical Disaster Loans - Loans to businesses to repair or replace disaster-damaged property owned by the business, including real estate, inventories, supplies, machinery and equipment. Businesses of any size are eligible. Non-profit organizations such as charities, churches, private universities, etc., are also eligible.

* Economic Injury Disaster Loans (EIDL) - Loans for working capital to small businesses and small agricultural cooperatives to assist them through the disaster recovery period. EIDL assistance is only available to applicants and their owners who cannot provide for their own recovery from non-government sources. Farmers, ranchers, nurseries, religious and nonprofit organizations are not eligible for an EIDL.

What are the Interest Rates?

No Credit Available Credit Available
Elsewhere Elsewhere
Home Loans 3.125% 6.250%
Business Loans 4.000% 7.934%
Non-Profit Organizations 4.000% 5.000%
Economic Injury Loans 4.000% N/A

What Restrictions are there on Loan Eligibility?

* Uninsured Losses - Only uninsured or otherwise uncompensated disaster losses are eligible. Any insurance proceeds which are required to be applied against outstanding mortgages are not available to fund disaster repairs and do not reduce loan eligibility. However, any insurance proceeds voluntarily applied to any outstanding mortgages do reduce loan eligibility.

* Ineligible Property - Secondary homes, personal pleasure boats, airplanes, recreational vehicles and similar property are not eligible, unless used for business purposes. Property such as antiques and collections are eligible only to the extent of their functional value. Amounts for landscaping, swimming pools, etc., are limited.

* Noncompliance - Applicants who have not complied with the terms of previous SBA loans are not eligible. This includes borrowers who did not maintain flood and/or hazard insurance on previous SBA or Federally Insured loans.

The application deadline for a business or home physical loan is November 17, 2006; the application deadline for an economic injury loan (EIDL) is June 18, 2007.

Loan counselors from the SBA will be available in the Courthouse Square building at Duke and Main Streets in Prince Frederick for two weeks beginning on Thursday, September 21, to assist citizens with loan applications. Counseling hours are from 10:00 a.m. to 7:00 p.m. daily and are also available on Saturday, September 23, from 9:00 a.m. to 1:00 p.m. Business owners and homeowners who experienced damage or loss due to Tropical Storm Ernesto on September 1 or 2, 2006, should call the Calvert County Department of Economic Development for additional information or to schedule an appointment with an SBA representative.

For more information on Small Business Administration disaster assistance, call 1.800.659.2955 or visit online at

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