Navigating Disaster Loan Eligibility

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While President Trump has declared a National Emergency on the federal level in response to COVID-19, it is dependent upon the Governor of each affected State to officially declare the emergency as well. This declaration would provide eligibility for businesses to apply for disaster assistance and provide loans to help businesses and homeowners recover from declared disasters.

Eligible States Today

To date, the following states are now eligible: California, Washington, Maine, Connecticut, Nevada, and Rhode Island.

Visit and click on the state’s emergency order to view what counties are eligible, and to securely apply for a loan.  In some instances surrounding states and counties may also be eligible.

3 Steps for Loan Applications and Processing

The U.S. Small Business Administration (SBA) provides low-interest, long-term disaster loans to businesses of all sizes, private non-profit organizations, homeowners, and renters.  According to the SBA, “These disaster loans offer an affordable way for individuals and businesses to recover from declared disasters.”

Here is guidance for the Disaster Loan Assistance Process:

  1. Apply for the Loan. Small businesses and small Ag cooperatives may borrow up to $2 million for Economic Injury.
  2. Property Verification and Loan Processing Decision. A credit review, loss inspection, and verification will be done before a loan officer contacts you with a loan determination.
  3. Loans Closed and Funds Delivered. A case manager will be assigned to help you meet all loan conditions and schedule disbursements.

Due to precautions needed for COVID-19, every loan is being processed online at  There is a helpful list of documents that businesses will need to upload when submitting an application.  You can find more details and the complete list of required documents on the SBA’s Disaster Loan document here.

Other helpful information to keep in mind:

  • Be mindful of process time. Due to the rapid pace in which this situation is evolving, and the amount of applications being received, the SBA is unable to provide the amount of time it will take before a loan officer will reach out to the applicant. They are processing applications based on the order they are received, therefore it is advised that eligible applicants submit their applications as soon as possible.
  • There is gray area. When the application requests “credit elsewhere,” this is a gray area. The SBA recommends that you submit the application and get assigned a loan officer and go from there with the details. Every application/business can be different, and they do not have to currently have an SBA loan to apply.
  • Interest rates for COVID-19 will be 3.75% with up to a 30 year term.
  • ‘Size of business’ is a gray area and applicants should not be deterred. The SBA recommends everyone should apply.  They have created several formulas they use based on the type of company and the industry they serve to determine what is a “small” business, and this definition is not ‘black and white’ at this time.

For those in eligible states currently, if you are in a situation where you think you might qualify and are in need of assistance, it is recommended that you submit an application through the SBA portal immediately.

Contact a K·Coe advisor with questions, or visit K·Coe’s ‘COVID-19 Resources & Updates’ page for additional action items, guidelines and resources to help your business navigate through this world health pandemic.

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