Flood victims urged to beat SBA deadline
Last Updated: 15:47 October 31, 2013
Koontz, a public information officer for the SBA, is making one final appeal to flood victims as the Nov. 14 deadline to apply for the loans approaches.
As of Thursday morning, the SBA has distributed 15,513 loan applications to homeowners, renters and businesses in Boulder County since a weeklong rainstorm inundated the Front Range. The SBA received 1,757 of those applications back and has approved 760 so far. In all, it has approved more than $33 million in loans, including almost $29.4 million to residents.
The fact that so many applications went unreturned, Koontz said Thursday, is good in that it likely means many people were insured or able to recover from the disaster without a federal disaster loan. But he’s also seen too many instances of residents or businesses believing they can foot the recovery bill themselves after a disaster – only to find out that their recovery ends up costing much more than anticipated.
“What I very much dislike is when folks contact us weeks or months from now and ask us to help them because their recovery ended up being more expensive than what they expected, and they have to be turned away,” Koontz said.
Once Nov. 14 passes – 60 days after the disaster – the SBA won’t be able to help flood victims in Colorado if they haven’t filed an application. Koontz said applying is free of cost and commitment. If approved, you don’t have to accept the loan. But the benefit of applying by Nov. 14 – even if you withdraw your request – is that the SBA gives you six months to change your mind if it turns out you need the loan down the road.
Koontz said it’s common for hidden damage not to show up until weeks or months after a disaster. Things such as a cracked foundation or hidden mold might not be discovered or cause a problem right away when initial repair costs are being assessed.
Koontz said people who still are trying to assess how much damage they have because of a lack of access to their property shouldn’t wait to apply with the SBA.
“That’s a mistake,” Koontz said.
The SBA loans, depending on your amount of damage and income level, come with interest rates of 1.937 percent or 3.875 percent for homes, 2.875 percent for nonprofit organizations, and 4 percent or 6 percent for businesses. Homeowners can borrow up to $200,000 to repair or replace their primary residence. Homeowners and renters can borrow up to $40,000 to replace personal property. Businesses can borrow up to $2 million for property damage or economic injury.
On top of those amounts, additional money also can be borrowed for flood mitigation measures such as French drains or raised foundations.
Koontz said 10 percent to 30 percent of disaster loans get declined depending on the disaster, noting that the Colorado flood arrived after some tough economic times. Even people who don’t think they can afford a loan should apply, he said. Those turned down by the SBA are then referred back to the Federal Emergency Management Agency for possible assistance with grant programs.
Koontz outlined three ways to apply for SBA loans. People and businesses who registered with FEMA should have gotten an SBA application in the mail that can be mailed back in. Applications also are available on the SBA website. Or people can go to disaster recovery centers and apply in person. Three disaster recovery centers are set up locally: at 55th Street and Arapahoe Road in Boulder near Premier Members Credit Union; at Twin Peaks Mall in Longmont; and at Lyons Elementary School in Lyons.
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