SBA Offers Low-Interest Disaster Loans to Texas Businesses and Homeowners

In response to an urgent need for disaster support, the U.S. Small Business Administration (SBA) has rolled out low-interest federal disaster loans for Texas small businesses and nonprofit organizations affected by severe storms, straight-line winds, and flooding that began on July 2. This initiative comes following President Trump’s disaster declaration issued on July 6, establishing a lifeline for those whose livelihoods have been disrupted.

The primary Texas county impacted, Kerr, qualifies for both physical disaster loans and Economic Injury Disaster Loans (EIDL). Neighboring counties, including Bandera, Edwards, Gillespie, Kendall, Kimble, and Real, can apply specifically for EIDLs, which are designed to help businesses and nonprofits recover economically, even if they did not sustain physical damages.

“The SBA is mobilizing to provide critical on-the-ground resources necessary for recovery,” stated Kelly Loeffler, SBA Administrator. “We are committed to delivering robust relief and support as recovery begins in the days and months ahead.”

The financial benefits of these programs stand out for small business owners grappling with the aftermath of natural disasters. Eligible businesses and private nonprofit organizations may borrow up to $2 million to repair or replace essential assets such as real estate, machinery, equipment, and inventory.

For homeowners and renters, the financial relief options include loans of up to $100,000 to replace or repair personal property, while homeowners may receive up to $500,000 for their primary residences. An additional perk allows applicants to request a loan increase of up to 20% of verified physical damages to invest in mitigation efforts aimed at weatherproofing properties against future disasters.

“One distinct advantage of SBA’s disaster loan program is the opportunity to fund upgrades to reduce the risk of future storm damage,” emphasized Chris Stallings, Associate Administrator of the Office of Disaster Recovery and Resilience at the SBA. Business owners are encouraged to collaborate with contractors to bolster their storm readiness and take full advantage of the SBA’s mitigation loans.

EIDLs further enable businesses to address working capital needs stemming from the disaster. These loans can cover fixed debts, payroll, accounts payable, and other essential expenses that may have accumulated due to disruptions, even if the entity did not experience direct physical damages.

Interest rates for these loans are competitive, starting at 4% for small businesses, 3.625% for nonprofit organizations, and 2.813% for homeowners and renters. Moreover, applicants can relish a grace period, with interest not accruing and payments deferred for 12 months from the first loan disbursement. The SBA determines loan amounts and terms based on the applicant’s financial circumstances, which means tailored solutions for each business or organization.

Small business owners seeking assistance can expect personalized support from SBA representatives once the Federal-State Disaster Recovery Centers open in the affected areas. For immediate inquiries, the SBA Customer Service Center is available at (800) 659-2955, providing further details and guidance for potential applicants.

Critical deadlines are also in place, with the application for physical property damage due by September 4, 2025, and economic injury applications due by April 6, 2026, ensuring that businesses prioritize their recovery efforts without unnecessary delays.

In light of these resources, small business owners in Texas now face both opportunities and challenges. The prospect of low-interest loans can facilitate recovery, encourage future-proofing investments, and ultimately sustain livelihoods impacted by natural disasters. However, navigating the application process and understanding the specific needs that qualify for relief requires diligence and preparation.

For more information on the SBA disaster assistance programs, you can visit sba.gov/disaster. Now more than ever, taking advantage of these provisions can make a significant difference in the recovery and resilience of small businesses in Texas.

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This article, "SBA Offers Low-Interest Disaster Loans to Texas Businesses and Homeowners" was first published on Small Business Trends