Small Business Administration (SBA) Approves $2.5 Billion Loans Since Hurricane Katrina

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Small business loan approvals reached the $2 billion mark on December 30, 2005 as the SBA continues to approve loans at a daily average of more than $52 million. Loan approvals on Tuesday January 10, 2006 alone amounted to a daily record of more than $84.6 million on almost 1,200 loans.

The SBA continues to accelerate our efforts to deliver long-term relief to affected homeowners and small businesses of Louisiana, Mississippi, Alabama, Texas and Florida. This is the fastest disaster response the SBA has ever given to any disaster in our 52-year history and I am proud of our dedicated staff, which is working with urgency and compassion to help rebuild the Gulf Coast.

Since its founding on July 30, 1953, the U.S. Small Business Administration (SBA) has delivered about 20 million small business loans, loan guarantees, and other forms of assistance to small businesses. Congress created the SBA in 1953 to "aid, counsel, assist and protect the interests of small businesses." American small business owners can learn how to take advantage of the federal government's small business loan programs at http://www.SmallBusinessCenter.com.

If you are in a declared disaster area and are the victim of a disaster, you may be eligible for financial assistance from the U.S. Small Business Administration - even if you don't own a business. As a homeowner, renter and/or personal-property owner, you may apply to the SBA for a loan to help you recover from a disaster.

The U.S. Small Business Administration continues to approve recovery and rebuilding loans for residents and businesses at a record pace over the first 10 days of January, surpassing $2.5 billion on Tuesday (1/10). The record pace for disaster loan approvals continues. Almost $1.4 billion of the loans are for Louisiana, and just over $1 billion are in Mississippi.

If you are the victim of a disaster, there is one basic loan, with two purposes, available to you:

1. Personal Property Loan: This loan can provide a homeowner or renter with up to $40,000 to help repair or replace personal property, such as clothing, furniture, automobiles, etc., lost in the disaster.

2. Real Property Loan: A homeowner may apply for a loan of up to $200,000 to repair or restore their primary home to its pre-disaster condition.

“Day after day, we are approving loans at an ever-increasing pace,” said SBA Administrator Hector V. Barreto. “The SBA continues to accelerate our efforts to deliver long-term relief to affected homeowners and small businesses of Louisiana, Mississippi, Alabama, Texas and Florida. This is the fastest disaster response the SBA has ever given to any disaster in our 52-year history and I am proud of our dedicated staff, which is working with urgency and compassion to help rebuild the Gulf Coast.”

Through Jan. 10, the SBA has approved 36,917 disaster recovery loans worth $2.564 billion. Only one other disaster in the nation’s history has exceeded the $2.5 billion mark for SBA loans – the Northridge Earthquake of 1994, at $4 billion in approved loans over a period of 12 months. The Florida hurricanes of 2004 topped out at $1.86 billion after more than nine months. The agency continues to receive new loan applications, bringing the current total to over 350,000, more than 100,000 more than were received after the Northridge Earthquake.

“The SBA disaster staff has grown more than four times larger than it was before Hurricane Katrina hit the Gulf Coast on August 29. We have processed 92 percent of the business working capital applications, disbursements have been made on almost a third of the approved loans, we have performed more than 147,000 site inspections, and we have processed more that 152,100 applications in less than four months,” Barreto said.

Be sure to check out http://www.SmallBusinessCenter.com for more detailed information on the federal government's small business loan and disaster loan programs.

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Eliot Hobbs
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