SBA halts disaster loans after Hurricanes Helene, Milton as funding runs dry
The Small Business Administration (SBA) has temporarily stopped offering new disaster loans to small businesses, homeowners, and renters in the aftermath of Hurricanes Helene and Milton. The surge of applications has depleted available funds, leaving thousands waiting for financial assistance.
Why did the SBA run out of funds?
The SBA’s disaster loan program provides financial relief to those impacted by major disasters. However, the back-to-back devastation caused by Hurricanes Helene and Milton led to an overwhelming number of loan applications. The SBA received around 37,000 applications for Hurricane Helene and over 12,000 for Hurricane Milton. The volume of requests quickly exhausted the funds.
Who is affected by this funding shortfall?
Businesses, homeowners, and renters who were relying on the SBA's Economic Injury Disaster Loans (EIDL) are directly affected. These loans help cover costs not met by insurance, such as repairing or replacing property, or offering working capital for businesses struggling after a disaster.
The SBA has made it clear that while they are out of funding, they will continue processing applications in anticipation of additional funding from Congress. This delay, however, means that no new loans will be offered until more money is allocated.
Are other disaster aid programs still available?
Yes, FEMA's disaster relief programs are unaffected by the SBA's funding shortage. FEMA continues to provide assistance for emergency housing, rent, debris removal, and critical needs like food and diapers.
Homeowners, renters, and businesses can also look into FEMA’s relief options for immediate assistance while they wait for SBA funds to be replenished.
What happens next for the SBA disaster loan program?
Congress is expected to address the SBA’s funding shortage once lawmakers return after the November election. House Speaker Mike Johnson has assured that both sides of Congress will work together to approve the necessary funds. Until then, the SBA is urging businesses and individuals to continue submitting applications, so they can be processed once the funding is restored.