How to Use an SBA Disaster Loan to Your Advantage

The future remains a mystery to everyone. Before the COVID-19 pandemic, no one expected that a virus could upend modern society in such a severe way. While you cannot plan for everything, you can definitely do your part to research your options for worst-case scenarios. When your company has been impacted in a major way, you may find it useful to take a closer look at what an SBA disaster loan can offer. Review the details of this service and learn more about how to take advantage of what this financing solution can provide. 

The Nature of the SBA

Due to the lasting impact, the novel coronavirus has had on modern business, there have been a number of initiatives taken by the federal government. From the CARES Act to the official Coronavirus Aid Fund, there are numerous ways that a company can get ahead after dealing with the consequences of COVID-19. When you find yourself struggling, it can be in your best interest to take a step back and consider what services the Small Business Administration can offer. Going this route can provide you with the most effective solutions for stimulating cash flow and maintaining your budget.

The Best Way To Get Started

Applying for an SBA disaster loan requires following the right steps. First, you need to look for a lender that has been approved by the Small Business Administration. Since the SBA does not release funds to borrowers directly, the approved lenders take on the responsibility. After you have found a lender you trust, you need to consider the requirements. The SBA will have general guidelines for a borrower’s qualifications, but the specifics will usually come down to the rules determined by the lender itself. 

The Standard Qualifications and Applications

To qualify for this type of loan, your business needs to meet a few standards. For one, you cannot employ more than 500 people. Since the SBA focuses mainly on small businesses, this is a steadfast rule. Once the funds have been released to you, however, you will be able to apply the money how you see fit. Whether you need to cover payroll, invest in materials for an upcoming order, or take advantage of opportunities to grow your brand, there are plenty of effective applications you can consider for your company’s future. 

There are a number of important points to keep in mind when it comes to taking out the right loan for your small business. Consider the requirements of an SBA disaster loan in order to see if this type of financing is a good option to pursue.