SBA physical-damage loans: up to $500,000 for homes and $2 million for businesses

The SBA institutional page on Physical Damage Loans explains the product that is most often confused in Puerto Rico after each declaration: the physical damage loan. The date of this note is September 15, 2026; the byline is the current deep link from sba.gov/funding-programs/disaster-assistance/physical-damage-loans. It is not an award list of the day; it is the program rule that applies when there is a declaration and geographic eligibility.

Eligible: homeowners, renters, private nonprofit organizations, and businesses of all sizes in a declared disaster area. Home and personal property loans: homeowners up to $500,000 to repair or replace the primary residence; renters and homeowners up to $100,000 for personal property (clothing, furniture, cars, appliances). Secondary homes or vacation properties do not qualify; qualified rental properties may go through the business physical channel.

Golden rule: loans cover losses not fully covered by insurance or other sources. Insurance proceeds are subtracted from the eligible loan amount. The money is not used for upgrades or additions unless required by the building code. It is not used to replace profits. In some cases, the SBA can refinance part of a previous mortgage if there is no credit elsewhere and the damage is substantial. Typical terms described by the SBA: first payment deferred 12 months; no interest accrual during the first 12 months; if unable to obtain credit elsewhere, fixed rate not to exceed 4%; SBA determines whether an applicant can obtain credit elsewhere; maturity up to 30 years; no prepayment penalty or fees.

Collateral: required to the extent possible for physical damage loans over $50,000 in Presidential declarations (and $14,000 in SBA Administrative declarations). Real estate is preferred even if equity is insufficient to secure the full loan amount. SBA will require available collateral but will not decline a loan solely for lack of collateral. The application is online; inspectors estimate the cost of the damage once the application is completed and submitted. Use the SBA Loan Portal for status.

Business physical disaster loans: up to $2 million to businesses or most private nonprofits for losses not covered by insurance. They cover real property, machinery, equipment, fixtures, inventory, leasehold improvements. Not for business expansion except for code requirements. Same insurance-deduction logic. If insurance proceeds must be applied to an outstanding mortgage, that amount can be included in the application. A business can qualify for a physical loan and an Economic Injury Disaster Loan at the same time; the maximum combined loan amount is $2 million according to the guided EIDL aligned with the same SBA disaster-assistance lane.

For Puerto Rico, the portal matters because each declaration—María, Fiona, Ernesto PA-only, storms of 2024—opens or closes different windows. A Federal Register notice PA-only can limit the universe to certain PNPs; a declaration with Individual Assistance opens homeowners/renters. Reading this page without checking the disaster number is how people apply late or at the wrong time. Loan approved ≠ funds disbursed at closing; and a loan is never a FEMA IA grant nor a Public Assistance obligation.

The local economic angle: SBA disaster debt enters the balance sheets of households and SMEs already hit by an unstable grid and expensive insurance. That’s why the underwriting of “credit elsewhere” and the rate cap for those who cannot obtain credit elsewhere are not fine print: they define whether the loan is a lifeline or a trap. Recovery journalism has to say “loan” when it is a loan, report deadlines of the corresponding FR, and not sell the SBA deep link as if it were a new P.L. of appropriations of the day. Anyone who confuses awarded loan, obligated FEMA project, and disbursed CDBG is mixing up pipelines.

SBA also operates Recovery Centers (DRC/BRC/DLOC) to help complete applications; the deep link of physical-damage-loans refers to apply online and to schedule appointments. In Puerto Rico, coordination with FEMA IA does not eliminate SBA underwriting: they are separate windows even though they sometimes share a building.

Fuente: U.S. Small Business Administration — https://www.sba.gov/funding-programs/disaster-assistance/physical-damage-loans