The U.S. Small Business Administration announced on April 29 the availability of low interest federal disaster loans for Michigan businesses, private nonprofits, and residents affected by tornadoes that occurred on March 6. The SBA issued a disaster declaration after receiving a request from Governor Gretchen Whitmer on April 27.
The disaster declaration covers several Michigan counties, including Berrien, Branch, Calhoun, Cass, Hillsdale, Kalamazoo, St. Joseph, and Van Buren. Indiana counties of Elkhart, LaGrange, St. Joseph, and Steuben are also included in the coverage area for both physical damage loans and Economic Injury Disaster Loans (EIDLs).
Businesses and private nonprofits can apply for business physical disaster loans up to $2 million to repair or replace damaged real estate or assets. Homeowners may borrow up to $500,000 to repair or replace their primary residence while homeowners and renters may apply for up to $100,000 to replace personal property such as clothing or appliances.
Applicants may also be eligible for a loan increase of up to 20% of their verified physical damage amount for mitigation purposes. Eligible improvements include strengthening structures against high winds or installing storm shelters.
“When disasters strike, SBA’s Disaster Loan Outreach Centers play a vital role in helping small businesses and their communities recover,” said Chris Stallings, associate administrator of the Office of Disaster Recovery and Resilience at the SBA. “At these centers, SBA specialists assist business owners and residents with disaster loan applications and provide information on the full range of recovery programs available.”
The EIDL program is open to small businesses as well as small agricultural cooperatives and private nonprofit organizations facing financial losses due directly to the tornadoes; however agricultural producers are not eligible except for aquaculture enterprises. EIDLs are designed for working capital needs even if there was no physical damage.
Interest rates start at 4% for businesses; 3.625% for private nonprofits; and 2.857% for homeowners or renters with terms up to thirty years. No interest accrues nor payments are due until twelve months after the first disbursement.
SBA customer service representatives will be available at Disaster Loan Outreach Centers in Cass County as well as St. Joseph and Branch counties starting Wednesday April 29 during regular hours through May 14.
