Anyone already applied and heard back? Trying to figure out what the time lines are.

Applied on Monday (8/28) evening after a boat ride with the family from our house. Loan was approved on Tuesday (9/5) but still waiting for case manager to be assigned to sign everything. You get an upfront $25k when the loan is activated. All other payments are reimbursements.

Doing any repair work before the loan is active disqualifies you from getting funds for that work. I'd be shocked if they enforce that though.

Update. Signing loan docs 9/13.

I was getting some social media chatter about not doing any repairs to the house until the SBA Loan inspector came out. So I called them. I feel even more confused now. Something about in Texas because of the Homestead, we are limited on the amount we can borrow. The initial unsecured 25k is tied to something. If we pay cash for repairs before the loan, they will not be reimbursed.

dummble said:

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I was getting some social media chatter about not doing any repairs to the house until the SBA Loan inspector came out. So I called them. I feel even more confused now. Something about in Texas because of the Homestead, we are limited on the amount we can borrow. The initial unsecured 25k is tied to something. If we pay cash for repairs before the loan, they will not be reimbursed.

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Date your invoices after the closing of the loan. I'd imagine every contractor will work with you on this.

Did you have an inspector come out? Or was it all over the phone?

dummble said:

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Did you have an inspector come out? Or was it all over the phone?

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Phone interview. They have a lot to process so fast tracking them.

Are these Loans just supposed to cover damages or could they cover improvements to flood proofing to help prevent future damages?

FYI your contractor needs to be present at closing to sign away their ability to lein the property. They do a **** job explaining this before hand.

So when you say Reimbursements, does that mean I turn in the 100's of lowes receipts, or do I have my contractor write an invoice for the work and he wraps up the material costs into his own? How do they handle all the DIY things I am doing? Can I invoice for my labor?

dummble said:

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So when you say Reimbursements, does that mean I turn in the 100's of lowes receipts, or do I have my contractor write an invoice for the work and he wraps up the material costs into his own? How do they handle all the DIY things I am doing? Can I invoice for my labor?

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Can not invoice your own labor.

Up to $50k will be dispersed for having all the paperwork complete. Anything past that you have to provide invoices to the case manager.

So we have a handy man style guy doing the insulation, drywall, painting and small misc repairs (hanging doors, misc trim) And we have contracting company doing the kitchen remodel, floors, exterior painting, door trim chair rail etc... Plus I am doing a lot of work. Is the GC the one that needs to be present at signing? Will they accept receipts from both the handy man and contractor and material receipts from stores? Will the question any of my purchases? None of them I would have any trouble turning in if this was an expense report. I am just worried if they are sticking to "return to existing". What constitutes an upgrade?

Really anyone other than the borrower can be the "contractor." The work and invoices can be from whoever (other than the borrower) to get dispersments past the initial 50k. They realize all the work and costs won't run through the GC.

So our loan is just a step behind your's. We are just waiting for a closing date and a case manager. The application approval person mentioned something about refinancing the mortgage with the loan. How does that work if the loan won't fully payoff the mortgage?

my loan officer is telling me to decline to loan and take that information to FEMA to try and qualify for more grants. That seems wrong to me.

If it's anything like last time, you could be waiting a long time for FEMA.

dummble said:

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my loan officer is telling me to decline to loan and take that information to FEMA to try and qualify for more grants. That seems wrong to me.

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Your loan officer is an idiot. Max grant is something like $34k. Not even close to being enough.

My loan officer called me Sat afternoon and threw a ton of information at me and none of it sat well... Maybe it was just the mood I was in.

1. The SBA wants to be added as lien holder on all my other property. I have paid off land on the coast and a house in CS with ~40% equity. He blamed this clause on a low equity position in the damaged house (we just moved in June), so I asked how much equity I need to get rid of this requirement? He didn't understand so I told him I could write a check to the bank to increase equity if necessary. He said it didn't really matter, they would call for this condition regardless...
2. I only qualify for 'market rate' at 3.55%. Because I have the ability to get other financing, they are not a lender of last resort for me so I get penalized and cannot get the 1.75% apr.
3. I told him to put the terms in writing and send me an email so I could see them and run some numbers... He told me he couldn't do that. I would only get a written statement of terms at the contract stage. And I had to make a decision before he left at 5:30pm that day.

I lost it on the guy at that point and shut it down. Anybody else have a similar experience? Is there any negotiations with these guys? Any thoughts or help would be appreciated...

TulaneAg said:

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My loan officer called me Sat afternoon and threw a ton of information at me and none of it sat well... Maybe it was just the mood I was in.

1. The SBA wants to be added as lien holder on all my other property. I have paid off land on the coast and a house in CS with ~40% equity. He blamed this clause on a low equity position in the damaged house (we just moved in June), so I asked how much equity I need to get rid of this requirement? He didn't understand so I told him I could write a check to the bank to increase equity if necessary. He said it didn't really matter, they would call for this condition regardless...
2. I only qualify for 'market rate' at 3.55%. Because I have the ability to get other financing, they are not a lender of last resort for me so I get penalized and cannot get the 1.75% apr.
3. I told him to put the terms in writing and send me an email so I could see them and run some numbers... He told me he couldn't do that. I would only get a written statement of terms at the contract stage. And I had to make a decision before he left at 5:30pm that day.

I lost it on the guy at that point and shut it down. Anybody else have a similar experience? Is there any negotiations with these guys? Any thoughts or help would be appreciated...

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Wow. That sounds pretty awful. How did they define your ability to "get other financing" ? I wouldn't place lien's on other property for this loan. Not sure on your situation or why they are doing that but my first conversations with them were positive as they were with actual SBA employees... They have since hired a bunch of temporary workers who don't know a damn thing and are just following checklists.

I'd just keep asking for a manager until you get someone who knows what is going on. Sorry to hear about your situation.

Quote:

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2. I only qualify for 'market rate' at 3.55%. Because I have the ability to get other financing, they are not a lender of last resort for me so I get penalized and cannot get the 1.75% apr.

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this is the part that jumped out at me when initially investigating SBA loans. there may be other beneficial aspects, but if you have the ability to secure other financing, there is not rate benefit to these loans.

I made it to a manager and got some things worked out:

1. Adding the SBA as a lien holder on our other properties: As soon as I fix the CS house from the rain damage it sustained, I plan on putting this house up for rent for 2 years or so to help pay ourselves back for this outlay. Once I told her (the SBA manager) that was going to become a rental, she removed that house from the collateral requirements. I still have to put up our Matagorda land as collateral to qualify for the full loan amount ($200k + $35k personal property), but I'm not really worried about that. The other option was a max benefit /loan amt of $104k (calculation based on equity in the house...basically a home equity loan) without putting up the other properties as collateral. Decent compromise...

2. Market rate: I'm a salesman so my income fluctuates and I don't make d*ck as a base. Once she found that out, she counted last year (I had a great year last year) as an exception and used my two prior years as salary history. That got me just under the max salary requirement and now I qualify for the 1.75%.

3. Terms via email: She still can't put the terms in writing via email...has to go to contract for me to see those terms in writing, but I have 30-days to review and accept the contract before I have to go through the application process again.

Hope that helps some of you. I was lucky that the manager led me to the right answers on some of this to help me receive the best benefit & rates. But I do expect there to be something else fishy when I get the contract. I'll let you guys know what happens in Round 3 of this saga. If you guys have any other tips/tricks please share.

Wow, alot of things to consider. Not sure if I want that loan.....may have to slow down repairs and wait for insurance to pay out. Essentially take the house back to sheetrock stage and wait for the payout.

I just got my terms - more than enough to restore my home, 30 years @ 1.75%, no payment for 12 months, and they will take a second lien on the home and require I carry flood insurance.

So in talking to our case manager, we have to have a "contractor" at our closing. We aren't using one because my husband used the build houses and is just using subs as needed. I pressed the manager and she did say that the contractor does not have to be licensed. What are y'all doing about this requirement of the loan?

mrsbeer05 said:

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So in talking to our case manager, we have to have a "contractor" at our closing. We aren't using one because my husband used the build houses and is just using subs as needed. I pressed the manager and she did say that the contractor does not have to be licensed. What are y'all doing about this requirement of the loan?

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Anyone who is not the borrower can be the contractor. All they are signing is a release on their ability to lien the property if you don't pay. Just have someone you trust / know sign as the contractor if you are running your own subs or utilizing multiple companies.

Its an asinine requirement as is you driving yourseld downtown to file the Deeds of Trust and Lien sith Harris County and mailing it to the SBA. They should file their own damn liens.

So far my timeline has been - Apply for SBA on 9/4. Phone call affirmation of Damages on 9/17. Talked to the loan officer on 9/21 and confirmed rate, terms and amount. Status on the website changed to approved. The amount we were approved for is more than enough to cover the home repairs and item replacement. I do not see us using it all. They did ask if I own other properties, but we have them insulated through and LLC. I guess another week or two before closing. 1.75% for 30 years starting 12 months after date of note.

My initial $25k should deposit by Monday. FEMA also came through for more than $0 which was surprising. Guess its time to finish the house.

The FEMA inspector came out today, walked the house, took a bunch of notes, took some pictures. She said I would hear back in a few days. We will see how that goes.

So after the initial 25k up front after signing, and you don't need any more, can you cut off the loan there at the 25k?

usmcaggie12 said:

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So after the initial 25k up front after signing, and you don't need any more, can you cut off the loan there at the 25k?

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Correct.

Initial $25k disbursement deposited in my account today. Lien and Deed of Trust were filed with Harris County and mailed a week ago.

Still waiting on what ever the next step is for the SBA Loan. We got the FEMA amount. 2/3 of the max. I am not sure if we should appeal. What is the general consensus?

dummble said:

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Still waiting on what ever the next step is for the SBA Loan. We got the FEMA amount. 2/3 of the max. I am not sure if we should appeal. What is the general consensus?

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What is the max that FEMA would give? Had our our inspection two weeks ago and FEMA approved us and deposited the money in our account five days after inspection. Obviously it is not enough to cover necessary repairs due to the fact that contractor prices have increased because of the large volume of work. We plan to appeal by the deadline when we have actual costs for the finished work (although some work may not be finished by the deadline).

We fully understand that FEMA is not going to reimburse full cost for all losses, it is only to make the house livable. Contractors are having to pay higher labor rates because of the tight labor market so what FEMA estimates for demo and repair in this market is not in line with actual costs among other things.

S*it thank god for this SBA Loan. Still ain't heard nothing from FEMA. Denied by Red Cross. No idea why I got denied. I got friends who applied for fun just to see and they got approved. No damage. Blows my mind.

$33k is the max. The way I understood it, is that the FEMA grant is not to make you whole or replace things, but to get your house livable. If I took the cost to demo, dry the house, put up drywall and insulation, replace the exterior doors and repair the AC units. Then we got just about that amount. If I add in floating and painting, custom trim, custom cabinets, hard wood flooring, carpeting, interior doors, kitchen appliances, tub, counter tops, tile, backslashes, pool chemicals, water bills etc etc etc. The amount looks like a slap in the face.

But the loan from SBA will make up that difference and that is the price I will pay for not having flood insurance.

We were approved for the Red Cross $400. My wife filled it out on her phone based on a facebook post.