SBA Home Disaster Loans for Repairs and Rebuilding

Quick facts about SBA home disaster loans

These limits appear in the current SBA physical damage rules and federal home disaster loan regulations. A maximum is not a promise that SBA will approve that amount.

Who may qualify

You may be able to apply when your home or personal property was damaged by the declared event and your location is inside the eligible disaster area. Business ownership is not required.

There is no simple nationwide household income limit. SBA reviews the financial file rather than using one grant-style income chart. Federal rules say SBA looks for repayment ability and satisfactory character. The agency also decides whether you have “credit elsewhere,” which affects the interest rate.

Ownership can be complicated after a disaster. The home loan rule says SBA may consider beneficial ownership as well as legal title when deciding who suffered the loss. If the deed, manufactured home title, inherited property, divorce papers, or estate records are incomplete, do not assume you are automatically barred. Ask SBA which proof it will accept and consider legal aid if ownership is disputed.

Common reasons a property or loss may not qualify

• A second home or vacation property is not eligible for a home disaster loan. A qualifying rental property may instead fit the business physical disaster loan program.
• Damage that insurance or another source fully pays is not an uncompensated loss.
• Cash, securities, and recreational vehicles such as boats, aircraft, and motorhomes are generally excluded from home disaster loans.
• Very high-value antiques, artwork, and hobby collections may be excluded when their replacement value is unusually high or hard to verify.
• Pre-existing wear, gradual deterioration, or damage unrelated to the declared event is not disaster damage.
• Failure to maintain flood insurance required by an earlier SBA disaster loan can affect eligibility for a later flood loss.

The detailed eligibility and exclusion rules are in 13 CFR 123.100 and 13 CFR 123.101.

What an SBA home disaster loan may cover

The loan is meant to repair or replace eligible property damaged by the declared disaster. SBA verifies the loss and approves specific uses in the loan authorization.

• Repair or replacement of an owner-occupied primary residence.
• Structural work, roofing, walls, floors, foundation, windows, and doors damaged by the disaster.
• Disaster-damaged electrical, plumbing, heating, cooling, septic, well, and other home systems.
• Repair or replacement of an eligible manufactured home used as the primary residence.
• Required work needed to meet minimum safety, decency, or current building code standards.
• Eligible household goods and personal property, including clothing, furniture, appliances, and a disaster-damaged vehicle.

SBA loan funds generally cannot be used for remodeling, additions, or upgrades that are not required by code. The legal loan limits and repayment rules are listed in 13 CFR 123.105.

Mitigation money to reduce future damage

An approved borrower may request extra money for measures that reduce future disaster risk. The increase can be the lesser of the approved mitigation cost or up to 20% of the verified loss before compensation from other sources, subject to the program limit.

Possible projects include elevating utilities, improving drainage, strengthening a roof, adding hurricane straps, installing a sump pump, using fire-resistant materials, building an approved safe room, or retrofitting for wind, earthquake, flood, or wildfire risk. SBA must approve the measure before increasing the loan. Review the SBA mitigation page before signing a contract.

Limited mortgage refinancing

SBA may allow refinancing of recorded liens in a narrow case when the primary home is totally destroyed or substantially damaged and the applicant does not have credit available elsewhere. The refinancing amount is limited by the eligible damage and current program cap. This is not a general mortgage refinance program.

Interest, payments, collateral, and liens

SBA home disaster loans are fixed-rate loans. The actual rate is announced for each disaster. Under the current rule, the rate cannot exceed 4% for an applicant who cannot obtain credit elsewhere and cannot exceed 8% for an applicant who can. SBA makes that decision; it is not based only on whether a bank has already denied you.

The maximum term is 30 years, but SBA chooses the term based on the financial file. There is no prepayment penalty. SBA says payments and interest are deferred for 12 months from the initial disbursement.

The current collateral rule is in 13 CFR 123.11. SBA’s no-fee rule is in 13 CFR 123.8.

How SBA, FEMA, and insurance work together

SBA, FEMA, and insurance are separate. Insurance usually comes first for covered losses. FEMA assistance is generally grant aid for eligible disaster needs and limited repairs. An SBA disaster loan can finance a larger eligible gap, but it must be repaid.

For disasters declared on or after March 22, 2024, FEMA removed the requirement to apply for an SBA loan before being considered for certain Other Needs Assistance. You may still choose to apply to SBA for additional repair or personal property money. See our plain-English comparison of an SBA loan and FEMA grant.

SBA cannot pay twice for the same loss. Insurance proceeds, FEMA awards, gifts, condemnation payments, or other compensation for the same repair may reduce the eligible loan amount. If you receive insurance money after SBA disburses the loan, you must report it. SBA may require that money to be applied to the loan principal.

Do not wait for a final insurance check when the SBA filing deadline is close. SBA has publicly told survivors they may apply before the insurance settlement and update the file later. Keep the policy, claim number, adjuster reports, denial or settlement letters, and proof of any deductible.

For the grant side of recovery, read our guide to FEMA home repair help.

How to apply without missing the deadline

The physical damage deadline is tied to the disaster declaration. It may be extended, but do not assume it will be. SBA regulations say late applications are accepted only when substantial causes beyond the applicant’s control explain the late filing.

SBA disaster customer service is available at 1-800-659-2955. Use 711 for telecommunications relay service. You may also email disastercustomerservice@sba.gov. In-person help may be available at an SBA center or a Disaster Recovery Center.

Documents to gather

SBA may request different documents based on the household, property, and disaster. Start with these:

Keep one disaster folder and use the same spelling of names and addresses across insurance, FEMA, SBA, and local applications. Our repair document checklist can help you organize the file.

What happens after you apply

SBA reviews the application, credit or cash flow, insurance information, and documents. After the application is complete, an SBA inspector may estimate the disaster damage. The inspection is not a contractor bid and does not guarantee approval.

If SBA approves the loan, read the authorization and closing documents closely. Confirm the approved uses, amount, fixed interest rate, first payment date, monthly payment, term, collateral, insurance requirements, and disbursement schedule. You are not required to accept a loan merely because SBA approved it.

If the approved amount is less than the repair estimate, ask what damage SBA accepted, what was excluded, and whether more proof is needed. Do not assume a contractor’s estimate controls the SBA loss calculation.

Emergency work, permits, and contractors

You may need to tarp a roof, remove water, board openings, shut off damaged utilities, or take other emergency steps before SBA completes the file. Photograph the damage first when safe, use reasonable measures to prevent more loss, and keep every receipt.

Before permanent repairs, ask the local building department about permits, floodplain rules, elevation requirements, inspections, and code upgrades. Our guide to home repair permits explains what to ask locally.

For a broader financing check, read safer repair loan options.

If SBA denies the loan or approves too little

SBA must give written reasons for a denial. Read each reason and answer it directly. The federal rule gives most disaster loan applicants the right to request reconsideration in writing.

• First denial: SBA must receive the reconsideration request within six months of the date on the decline notice.
• What to include: Significant new information that addresses every stated reason for denial.
• Second denial: A written appeal must be received within 30 days of the second decline action and explain why the decision should be reversed.

The reconsideration and appeal rule is in 13 CFR 123.13. Keep proof showing when SBA received your request.

If hidden disaster damage, changed code requirements, or certain contractor malfeasance increases the eligible cost after approval, ask SBA about a loan increase. The general rule says to request an increase as soon as possible and no later than two years after approval, unless SBA grants a waiver for extraordinary and unforeseeable circumstances. The timing rule is in 13 CFR 123.20.

If you missed the original application deadline, call SBA immediately and submit the application with a clear written explanation and proof of the substantial cause that was beyond your control. Acceptance is not automatic.

For general appeal planning, see what to do after a home repair denial.

Other help when an SBA loan is not enough

An SBA loan may not fit if the payment is unaffordable, title is disputed, the home may be bought out, the structure is unsafe to rebuild, or insurance remains unresolved. Check these backup paths:

• FEMA: Ask about home repair, replacement, rental assistance, displacement help, and other eligible needs when Individual Assistance is open.
• Mortgage help: Contact the servicer and a HUD-approved housing counselor before missed payments grow.
• Local recovery programs: State, tribal, county, or city offices may later open Community Development Block Grant Disaster Recovery programs, buyouts, elevation assistance, or homeowner rehabilitation.
• Legal aid: Get help with heir property, title, contractor fraud, insurance disputes, liens, or appeal documents.
• 211 and long-term recovery groups: Ask about cleanup, case management, temporary housing, donated materials, volunteer labor, and unmet-needs committees.
• Nonprofit repair help: Local Habitat for Humanity, Rebuilding Together, faith-based groups, and disaster volunteer organizations may offer limited services.

Use our guide to find local repair programs. Local HUD-funded repair programs are explained in our CDBG and HOME guide.