Repayment of federal disaster loans from Superstorm Sandy, COVID-19 and other cataclysmic events has been postponed again — this time until next year, officials said.
The U.S. Small Business Administration, citing the coronavirus-induced recession, said borrowers don’t have to resume making payments on their Economic Injury Disaster Loans for an additional time period on top of earlier deferments. The agency makes the EIDL directly to borrowers.
The added deferment affects disaster loans taken by homeowners and businesses harmed by Sandy on Oct. 29, 2012, among others. The decision only applies to borrowers who aren’t late in making payments.
"As a result of the difficult economic situation brought on by the COVID-19 pandemic, the SBA is extending the deferment period for all COVID-19 and other disaster loans in regular service status as of March 1, 2020 until 2022," said Beth L. Goldberg, director of the agency's New York District, which includes Long Island.
She said on Tuesday that SBA has helped more than 313,000 borrowers in the state via EIDL over time.
This is the third postponement of payments on loans made prior to last year. The first, announced a year ago as COVID struck the country, expired on Dec. 31, 2020, and was followed by a second to March 31.
Now, recipients of loans made prior to last year have an additional one-year deferment. They must resume making payments with the payment due before March 31, 2022.
As with the previous deferments, this one is automatic, and borrowers don’t need to make individual requests of SBA. They will continue to receive notices stating no payment is due and showing the amount of accrued interest.
The deferment doesn’t cancel preauthorized debit or recurring payments on the EIDL. The payments must be canceled by the borrower via pay.gov, an online bill pay service, or by calling SBA.
Locally, many of the outstanding EIDL were for Sandy damage. More than $90 million in loans were approved for businesses and about $730 million for homeowners in Nassau and Suffolk counties, according to a Newsday analysis of SBA data as of October 2014. The number of businesses and homeowners that accepted the loans wasn’t immediately available.
For disaster loans made last year, including those for COVID relief, the due date for the first payment has been extended from one year to two years from the date that the loan was made. For loans made this year, the first payment due date is extended from one year to 18 months from the loan date.
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