Disaster recovery is an essential aspect of modern-day business – especially with calamities such as data breaches, pandemics and significant economic downturns. The federal government’s Small Business Administration has so-called SBA disaster loans available for companies that meet the requirements; in fact, there are specifically COVID-19 disaster relief programs still ongoing.

Types of SBA Disaster Loans

Not only can companies benefit from these loans – but sole proprietors and individuals can, also. As is usually the case with all small business loans from the SBA, they liaise with lenders (the latter actually sends you the funds) and the government acts as top-notch guarantor in case of default.

One type of SBA disaster loan is the physical loan; which is employed to rectify property damage. This covers buildings, land, machinery and any equipment that comprises your inventory. The second type of disaster loan is geared towards helping you with economic recovery; basically, anything from payroll to working capital that took a hit as a result of the disaster in question.

Securing the Loan – Requirements

You can apply for one either online via forms on the government website, or submit an application at a local SBA booth/office in your city. Before you do so, make sure that your business is located in an official disaster area, and bring the following: recent income tax returns and schedules, a document of your liabilities, personal financial statements for every part-owner of said business, sale figures for your most recent quarters and profit and loss statements.

SBA Disaster Loan To-Do List

To maximize your chances of securing the SBA disaster loan, make sure you:

Print out your company documents and federal tax returns and prepare them before the loan officer’s arrival – make sure everything is complete to expedite the process

You have to meet the creditworthiness requirements, so check your FICO score – both business (first) and personal; the better one is the one you will use

If you’re looking for a physical disaster loan, then estimate the value of your losses; if economic recovery is the loan you need, gather proof of income lost

Ultimately, to be assured of getting one of the SBA disaster loans, you have to have a solid credit history, and display an ability to repay the loan.