The SBA Steps in After Disasters

CHICAGO — If your self-service laundry has suffered physical damage or has sustained economic injury after a disaster, you may be eligible for financial assistance from the U.S. Small Business Administration (SBA). If your store—regardless of size—is located in the declared disaster area, you may apply for a long-term, low-interest loan to repair or replace damaged property.

Even if your property was not damaged and you are a small-business owner, you may apply for a working capital loan from the SBA to relieve the economic injury caused by the disaster.

Physical Disaster Loans

Businesses of all sizes may apply for a physical disaster loan of up to $2 million to repair or replace damaged real estate, equipment, inventory and fixtures. The loan may be increased by as much as 20% of the total amount of disaster damage to real estate and/or leasehold improvements, as verified by SBA, to protect the property against future disasters of the same type. These loans will cover uninsured or underinsured losses.

Economic Injury Disaster Loans

Small businesses of all sizes suffering substantial economic injury may also be eligible for an economic injury disaster loan of up to $2 million to meet necessary financial obligations—expenses the business would have paid if the disaster had not occurred.

Interest Rates

The interest rate on both of these loans will not exceed 4% if you do not have credit available elsewhere. Repayment can be up to 30 years, depending on the business’ ability to repay the loan. For businesses with credit available elsewhere, the interest rate will not exceed 8%. SBA determines whether the applicant has credit available elsewhere.

Application Information

Businesses may apply directly to the SBA for possible assistance. The SBA will send an inspector to estimate the cost of your damage once you have completed and returned your loan application.

The most frequently asked questions about disaster loans, according to the SBA, are:

  • What information must I submit for a disaster loan?
    Submit a completed loan application and a signed and dated IRS form 8821 giving permission for the IRS to provide the SBA your tax-return information. The SBA needs current financial information such as a personal financial statement, a current profit-and-loss statement, balance sheet, and a list of debts.
  • Can I use the disaster loan to expand my business?
    The disaster loan helps restore property to pre-disaster condition, and, under certain circumstances, protects the structure from future disasters. It cannot upgrade or expand a business unless required by local building codes.
  • I already have a mortgage on my business. Can the SBA refinance my mortgage?
    The SBA can refinance all or part of a previous mortgage in some cases when the applicant does not have credit available elsewhere, has suffered uninsured damage (40% or more of the property value), and intends to repair the damage. SBA disaster loan officers can provide additional details.


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