BAY ST. LOUIS, Miss. -- Six months after back-to-back-to-back hurricanes lashed the Mississippi Gulf Coast and southern Florida, the Small Business Administration says it has been processing and approving low-cost disaster loans at a record pace for tens of thousands of hurricane victims.
But those figures carry little weight with critics who say that even a record pace isn’t fast enough given the scope of the natural disaster, or with victims left wondering why their application has been denied or, worse, if it has gotten lost in some bureaucrat's computer.
The SBA has the numbers to back up its claims. As of Feb. 21, its records show it has approved a total of 17,136 home loans worth a total of $1.2 billion in Mississippi and 30,188 home loans worth $2 billion in Louisiana. Across all the areas hit by the hurricane trifecta of Katrina, Rita and Wilma, the SBA has approved $4.12 billion in loans to more than 58,000 residents who qualified for loans of up to $200,000 at below-market interest rates to repair or rebuild their homes or up to $40,000 to replace renters' lost possessions.
In hard-hit Hancock County, Miss., alone, the SBA has approved 2, 416 home loans totaling more than $245 million.
"The SBA has been approving disaster loans at an unprecedented pace," says SBA Administrator Hector Barreto. "Never before in our history has the SBA been asked to respond to a disaster of this magnitude, and our people have worked tirelessly, compassionately and with urgency to meet the needs of the people affected by these hurricanes. Our results beat by more than six months the time it took SBA to reach $4 billion after (California's) Northridge Earthquake, which was the only other disaster to surpass the $2 billion mark in our 52-year history."
But it's also possible to look at the glass as half empty. Six months after Katrina, the SBA still hasn't processed 31 percent of the home loan applications it has received in Mississippi and 41 percent from Louisiana residents. And of those applications it has processed, 41 percent were rejected in Mississippi and 39 percent in Louisiana.
Criticism over qualifying criteria
The SBA has no explanation for the high numbers of rejected loans other than to say that the applicants didn’t have adequate income or good credit ratings.
"We’re a little bit more lenient (than banks) when it comes to qualifying standards," says Matthew Young, an SBA spokesman in Mississippi. "However, we still have to be accountable and prudent in making the loans because it’s taxpayer money."
That statement highlights the Catch-22 nature of the disaster loan process: Many Katrina victims are out of work and forced to lean more heavily on credit cards than ever before, a combination that few lenders are likely to consider a good credit risk. And despite their desperate financial circumstances and the fact that many Gulf Coast residents had comparatively low incomes before the storm, the SBA hasn't taken any steps to adjust its qualifying criteria.
The agency's response also has left some hurricane victims with clean credit but little cash feeling bitter and frustrated.
Patrick Kimbrell of Bay St. Louis said he applied for an SBA loan after FEMA rejected his request for disaster assistance because he hadn't yet applied for a loan. Then the SBA turned down his application because the agency deemed him not creditworthy, he says.
"My wife and I bought a house just five months before Katrina hit," Kimbrell says. "The bank saw nothing wrong with my credit and loaned me the money.
"I don't know what the heck is wrong with the SBA. I've never missed a payment in life; paid off several loans, including some car loans, and didn't carry any balance on my credit card."
Kimbrell says he is making repairs on his home using a small insurance settlement. "It won't be enough to repair (the house) all the way," he says. "But at least we got a roof put on it."
The SBA does have an appeal process for those that have been denied a loan, and Kimbrell said he might challenge the ruling if he can find the time between making repairs to his home, making a living and getting his family's life back on track.
Process, process, process
Getting an SBA loan can be a daunting process, especially if all your financial records were wiped out along with your home. SBA applicants must submit loan applications and provide income statements, tax returns and other income-verifying data. Loan officers then assess an applicant's capability to repay the loan based on its internal criteria. SBA "loan verifiers" also physically inspect the damaged properties. The agency also requires that applicants put up some kind of collateral, which in disaster situations usually means the real estate they are rebuilding.
Although the agency averaged more than $36 million in loan approvals a day during December, some applicants say they have been waiting for months to hear whether their applications have been approved.
"We've had an SBA application in since before Thanksgiving and haven't heard a single word," says Yancey Pogue, a Bay St. Louis real estate agent. "Now, to be fair, I also haven't been pestering them on the phone every day like you have to do with every other government agency these days, so maybe it's time I get started on that mission. But don't you think that ... waiting for that long just to hear back is, well, wrong?"
Pogue isn't the only one criticizing the SBA for the pace at which it is processing applications. Lawmakers have ripped SBA officials at congressional hearings, accusing officials of dragging their feet at a time when people need critical help.
SBA's Barreto acknowledges that in the early days after the hurricanes his agency suffered through computer snafus, had problems gaining access to the stricken areas and that its 880-person disaster assistance section was overwhelmed. But he says the first two problems have been solved and the agency has grown its disaster-assistance team to more than 4,000 since then.
"More than two-thirds of SBA's 6,346 employees are working seven days a week to handle the demand for loans," he says. "We are committed to doing whatever it takes to make sure every person who needs and qualifies for help, gets it quickly."
SBA chief has his defenders
And although some in Congress called for Barreto to resign, he has his supporters on Capitol Hill as well. Hurricanes Katrina, Rita and Wilma were a "triple whammy (that) caused unprecedented challenges for government officials trying to provide assistance to the hurricane victims," House Small Business Committee Chairman Don Manzullo, R-Ill., said at a December press conference. "Quite frankly, the SBA is in a no-win situation with this disaster. It is understandable that those affected by the disaster want to get their loans as soon as possible. At the same time, taxpayers demand accountability and a reasonable expectation that the loans will be paid back. That takes time to determine whether applicants can pay back the loans."
Manzullo noted that owners of businesses that received SBA loans to rebuild after the 9/11 terrorist attacks also complained about the slow processing times. "Earlier this year we learned that twice as many of the 9/11 loan recipients defaulted on their loans than any previous disaster, saddling taxpayers with the added costs of repaying the loans," he said. "And still, the SBA was criticized for not responding fast enough."
Such statistics hardly register with someone like Kimbrell, who is juggling two jobs and scrambling every day to make ends meet. "I'll tell you about disaster," he says. "The SBA is a disaster, that's what that is."
Historic ruins await their fate
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I wonder who did the credit reports for the Savings and Loan crisis of the 1980's? As I recall the government never blinked twice when the bill was 153 billion dollars. Those were the lamers that ought to have been scrutinized, not the every day people just trying to rebuild thier lives after Katrina.
Mark Falasz Crystal Lake, IL. (Sent Mar 1, 2006 7:28:35 PM)
I can sincerely sympathize with those who want to continue to live in their hometowns, but I feel that the taxpayers of this country should not always be responsible for everything. If my home burns to the ground, gets blown from its foundation, gets caught in a mudslide, or gets flooded, the local, state, or federal government isn't going to assist me. If those who were unable to get home loans before the disaster, due to credit problems or lack of income, then shouldn't be able to get loans today. I can't afford to pay increased taxes to repay bad loans. I think we have become a country divided by those who will do what it takes to live and those who want someone else to provide every aspect of their existance. I have a hard enough time providing for my family without the assistance of public housing, welfare, foodstamps, medical cards, etc. that I definitly can't pay for others to sit and do nothing to better themselves. If you want to do better, there is no reason why people can't. Most just choose not to try.
Ray, Middlesboro, KY (Sent Mar 1, 2006 7:41:28 PM)
I cannot believe how mean-spirited people are. They are quick to lump everyone in the same category. The sad thing is that the perception is that it's only the people shown on tv during the storm asking for assistance. I wonder if the skin pigment was different, would there be this same negativity. Do you realize that the vast majority of those who you saw on tv did not even own homes!!! They have no reason to apply for SBA loans. Has it ever occured to you that hard-working individuals need help also?! Come on people, get a grip! I am from the New Orleans area, and 75% of my family (blood and in-laws) were affected....not to mention countless friends. People act as though it is just that easy to pick up and relocate. Do you realize that people lost all of their mental and emotional support as well. Normally in a disaster, the community (as a whole) is in tact. However, in this case, ENTIRE COMMUNITY SUPPORT was destroyed. Absolutely nothing to hold on to except the things they left with. The vast majority of the victim's immediately family members are still dispersed. That is something 99% of the critical people who've never been in this situation can never comprehend!!!
As far as people getting jobs to pay their way....a minimum wage job will not help them get back on their feet....especially in other metro areas. You know, we can help an entire FOREIGN country get on their feet with no problem (at least monetarily), but we gripe and complain about helping our fellow americans. And for those who think the govt shouldn't help, that's why we pay taxes....to help in a time of need. Do you think that those who are being denied loans but worked and paid taxes all of their working life appreciate their hard earn $$$ going to foreign countries and not given back to them??????
IMHO, it is a racial issue....but people don't want to address that.
Q, Atlanta, GA (Sent Mar 1, 2006 7:48:57 PM)
somebody please tell me what happened to the 64billion$$$ that supposidly went to the katrina survivors to rebuild ??? you can start a small country with 64 bills!!! ANSWER THAT BUSH!!!
john provine kearny,nj (Sent Mar 1, 2006 7:49:35 PM)
I've forgotten what country I'm living in ! I remember when our Government helped Americans first when there was a disaster..Now all you see and hear about is the billions being spent on Iraq, India and any other country that needs help. Something is terribly wrong, Americans need help. especially in Louisiana ,Mississippi, Alabama and parts of Florida.
We have lost thousands of our young men in Iraq and the Arab countries trying to help them stabalize themselves, this is happening while AMERICA is falling apart, We have been abandoned by our own Government, And they are giving away our country. Everyone is accusing the Mexicans of taking our jobs,that may be true, But our government is giving our jobs to India, and our businesses to any Indian that comes over here.(NOT NATIVE AMERICANS)
Walk into any gas station, motel or convenience store and you'll get the BIG picture. And the American tax payer is paying the bill..Thank You Mr. President, Atleast help the Katrina survivors like we did Miami REMEMBER..........
Ron Holley Sr. Lake Park, Ga. (Sent Mar 1, 2006 8:04:17 PM)
It's not the SBA's obligation or responsibility to GIVE money away. Of course there should be some allowances for the hurricane victims, but they should not be approving loans for people who obviously will not be able to pay them back (otherwise it's not a LOAN). A large number of unpaid loans like that would be a disaster, at the expense of taxpayers, government and the country at large. The SBA is already going out of their way to help - asking them to do more is asking them to act irresponsibly.
Amy, Dallas, Texas (Sent Mar 1, 2006 8:53:01 PM)
There is a certain degree responsibilty the residents of the gulf coast and other hurricane prone areas need to take. M Anderson nailed it when he said people want little government involvement until they need something or someone to blame. I live in South Florida and was hit by Frances, Jean, Katrina and Wilma. Fortunately my home sustained only minor damage but I made sure that I prepared and protect my investment with insurance. I get the needed supplies and when we are recomended to evacuate, we do. The expense and inconvience of preparing for any natuarl disasters is far worth protecting my family. People need to take responsibility for themselves and be grateful for what our government is able to do. If you think another countries government would do better, then move!!!
Alyson, Florida (Sent Mar 1, 2006 9:08:23 PM)
Not getting a loan, is a blessing. The last thing these people need is payments.
STEVE FARRAR W-S NC (Sent Mar 1, 2006 9:08:46 PM)
Why am I less deserving of assistance from the goverment than any other citizen in this country. I pay my taxes just like all of my neighbors from New Orleans to Alabama do. When disasters happen in other parts of the country, we send help and volunteer because we KNOW it can happen to any of us. So go ahead and tell us how STUPID we are because we want to rebuild our lives. But remember, disasters can strike anywhere. Our critics could be the next ones being helped by us lazy residents of Louisiana and Mississippi. Oh by the way, Jane from Orlando, how many times did my tax dollars help rebuild Florida.
George, Slidell, La. (Sent Mar 1, 2006 9:42:37 PM)
The people who had nothing, still have nothing,except those lucky enough to get some of the pacifyer moneys. The people who were doers and havers, are doing and having, as before, with or without the help of the government or charities. The whiners have new stuff to whine about. The crusaders have new crusades. The polititions have new things to blame on the other guy, but overall for most of us in the usa, nothing has changed. You want changes ? Pay attention when they're picking leaders. Benjemin Franklin said, ( "the people of this country will ultimately inherit the type of government they deserve" ) Think about that.
Jim Alabama coast (Sent Mar 1, 2006 9:49:03 PM)
Patrick, man hang in there.....things in life come hard{i've thought ...why not me ...a million times}...but when you get what you work for...what you can say...is WE did it...ain't nothing in this old world easy or cheap....God i wish it was...family is everything...you still have that....you'll make it man....our hearts are with ya'll.....BUILD...make a home for your children
andy,ms (Sent Mar 1, 2006 9:53:29 PM)
As a police officer with a local Mississippi Gulf Coast Dept. I am ashamed to see the ignorant self-rightious people in our country. Not everyone in these disaster areas was looking for or even expected a handout. To be involved with some of the people that lost every single thing they ever owned and some nearly their lives with only a story to tell has really brought things into perspective for lots of people in these areas. If any one single person were to sit and listen to what people here have gone through before,during and the aftermath of Katrina I'm sure the comments on this blog would be somewhat different. I have sat in shelters for "free" in uniform with these people and all they really want is someone who will listen to them and understand what they endured. You really have no concept of the situation unless you were there, therefore leaving you with the decision of who you will criticize next.
South MS Resident, Pearl River,MS (Sent Mar 1, 2006 10:03:00 PM)
THIS SITE IS NOT ABOUT NEW ORLEANS - IT'S ABOUT BAY ST. LOUIS AND WAVELAND, MISSISSIPPI - We don't care what you think about what should or should not happen in New Orleans - I think the moderator of this website should not post ANY comments about any place but the Bay/Waveland - after all, they named it: "TWO towns rebuild after Katrina"
T. Ryan (Sent Mar 1, 2006 10:22:27 PM)
I am in gulfport miss now and have not seen the tenacity that these people are showing. No one is asking for handouts. Just some compassion and recognition that we are all americans and this could happen anywhere. I hope you hardhearted folks live your lives without any catastrophes or hardships. The people i have met here are to be admired and praised.
joe , sumter sc (Sent Mar 1, 2006 10:30:25 PM)
SBA's appeal process is no better than the people who process the paper work. When I was asked to go to vietnam I went no questions asked, but it you had one SBA loan then you must not need another they think no matter if you lost everything. so my feeling are the hell with my government.
Bill, Bayou la Batre, al (Sent Mar 1, 2006 10:35:18 PM)
Maybe people should consider not living in hurricane-prone areas, eh? Why do we keep getting asked to subsidize people who take risks? That is why I live in a low-risk area and have appropriate insurance to cover the basic risks.
Bob, Santa Ana, CA (Sent Mar 1, 2006 10:45:54 PM)
You know people from all around this world has come to our sides here in Waveland, MS. People, please stop and think before you say what we should be doing. Can you imagine what it would be like to watch every family member work 8 hour days, then go (HOME)to a shell of a house and work for another 4 to 5 hours. Then go into the FEMA trailer and try having a little family time. You get to a point to say "Thank you God for such a wonderful husband and everything we have let around us." I feel people really have no idea what it is like to live here. Many of us here are not waiting for someone to help. The thing that really botheres a lot of people is everywhere you look there is some type of "KATRINA" programs, but when does it get to the people living in Katrina world, trying to start over.
Please stop and think about people like us
GOD BLESS
TT
Tina StigletT (Sent Mar 1, 2006 10:53:26 PM)
The people in New Orleans work, are working, and have insurance. They paid taxes. FEMA backed the flood insurance policies, and is now reneging on paying. State farm and other insurers are refusing to pay.
I am amazed at the classist/bigotry in this forum. These people are taking care of themselves. But the COnstitution also says the feds have a responsibility to "maintain good order". That means regulating insurers who won't pay, regulating banks using ridiculous standards for loans (SBA loans included), regulating and supervising the funds for the clean up (which people are taking loans out for at high rates and doing THEMSELVES) and helping to PREVENT THIS DEBACLE in the first place, by building adequate levees.
When disasters hit the vicious people with no sympathy for New Orleans, perhaps they will learn. I've found people suddenly get "insight" into situations when they hit them. When the hell of a natural disaster hits Florida, Madison, etc, or personal disasters like cancer, etc hit, some of these people will get a clue. Karma's a B*****, and they are asking for it. It's maybe comforting to think that we Louisianaians are lazy or shiftless. The thought of your government abandoning you, and treating you the way we have been treated, is frightening. Does thinking that it's all our own fault cover your fears of this corruption and indifference?
My family is from Louisiana. My family is rebuilding, without any help from the Red Cross (hah- that money has not hit any of the vitims I know) or the feds. We are the lucky ones, but we know people who are not lucky. Their money was tied up in their houses; without the houses, they have nothing, and they can not afford the outrageous rents being charged in the city. We will remember who helped, and who did not.
Selika Ducksworth (Sent Mar 1, 2006 10:56:10 PM)
You can not build a levee system on Mississippi silt. That is futile. You can not anchor the system to anything stable. The city and state should not have allowed building homes 20 feet below sea level. That should go without saying. The US is apparently entering a twenty year period of strong hurricane activity such as occurred early in the 20th century. Anyone building in these hurricane-prone areas should do so at their own risk. Be forewarned. You can't expect the governement to keep compensating people for making poor decisions.
Bob, Santa Ana, CA (Sent Mar 1, 2006 11:23:07 PM)
This disaster is a no win situation for SBA, FEMA, and all goverment agencies involved in recovery. This event required 10 times the normal daily resources of these agencies. Does the normal tax payer want to pay for these resources to be on "stand by"? Of course not. The impact of Katrina created an emotional reaction and desires that no one should go without. But, that is not the nature of disasters. They don't work that way. And when evaluating our governments response we have to be reasonable and realistic. If we don't want to pay to prepare for the worst case scenario, we can't expect to be ready for it. These agencies and their staff will do everything in their power to help. But it won't be enough. Because America expects perfection, reasonable or not.
Mark, Arlington, Virginia (Sent Mar 1, 2006 11:29:21 PM)
The man in the story applied for an SBA LOAN, which if he gets it, he'll pay back with interest. This money will not be GIVEN to him, it will be LENT to him if he gets the loan. So far, he hasn't. He is doing what he can to rebuild his home with the insurance settlement he received from his INSURANCE COMPANY. He says the settlement is not near enough to do the job, but that he is glad that at least he has a roof over his head now and that he WILL CONTINUE TO WORK HIS TWO JOBS to make ends meet and to rebuild in BAY ST. LOUIS, MISSISSIPPI.
This sight is not about New Orleans, Louisiana. Watch the news on any channel and read any newspaper or magazine to find out all about New Orleans. Buy an atlas to find the MISSISSIPPI GULF COAST, where the Hurricane hit after hitting ST. BERNARD PARISH, LOUISIANA. And read the articles before you post. Do you just look at the pictures?
And by the way, FEMA, SBA, Red Cross, or any other government entity or charitable entity is not building anybody's house back down here, and most insurance companies aren't doing it either. Even if you had homeowners, flood, hurricane, etc. insurance, insurance companies are doing all they can to not pay up. If it's flood insurance, they say it wasn't flood damage. If it's homeowners, they say it wasn't wind.
This is a true story: Three houses in a row on the same street, the one in the middle is destroyed by water according to their insurance company's adjuster the family never saw. The other two houses on either side are destroyed by wind according to their insurance companies. Flood insurance pays hardly anything. The people in the middle had every kind of insurance they could buy except for earthquakes. They are paying house notes on a slab of rubble and don't even have enough money from their flood insurance to clear their land, much less to rebuild their house. The wife's mother and father were killed in their hurricane-proof house made of concrete and steel with 14 inch walls. And she and her husband are expecting a baby soon. The people on either side have already cleared their slabs and can start rebuilding.
And since when has a category 4 hurricane caused no wind damage? The wind came first and lasted all day. The storm surge came and went in an hour or so. It was not slow rising water, like a flood. It was sudden, like a tsunami. The insurance companies should be ashamed, but of course they aren't. They can't go broke, after all. What would happen to them? THEY MIGHT LOSE THEIR HOUSES.
Jane, Southern Mississippi (Sent Mar 1, 2006 11:38:13 PM)
EXACTly. What can we do. My house was hit bad by Ivan. Unfortunate circumstances left the house without insurance. The estimate for repairs was $26,000. FEMA gave us $5,000 to cover evacuation cost and lost food. The new roof costs were over $8,000. Dennis tore off my blue roof and caused more damage. FEMA gave us $275 for Hurricane Dennis damage. SBA disapproved both our loan applications. At the financial pace I'm on I'll have all my repairs done and paid for by July 2007. I sure hope mother nature understands.
Daniel
Daniel, Navarre, Fl (Sent Mar 2, 2006 12:57:14 AM)
It is sad that people have no comprehension of what hardships people in the affected areas went through. If they had coverage they should be compensated just like any other loss would be.
Hopefully, the aid will come through but those of us lucky to live in other areas of the country should count our blessings.
We have one family from New Orleans living in our town and they are doing great.
J. Waldman, Telluride, Colorado (Sent Mar 2, 2006 12:59:47 AM)
Wow, reading some of these comments makes me feel ashamed to be American. It is not just New Orleans that needs assistance getting back on their feet. It is a large part of the gulf coast area. It is not just poor people that didn't have a job before that need assistance. You are looking at police, fireman, nurses, garbage men, insurance agents, whatever type of job you can think of. It's not just homes that need to be rebuild it's businesses. I for one am glad my tax dollars are going to help my fellow Americas.
For all the people that are complaining about people wanting to move back to NO and the rest of the Gulf coast area. By your reasoning noone should live in an area that has any kind of natural disater threat. Okay let's see that means everyone needs to move out of California because of the threat of earthquakes oh and while we are at in let's move everyone out of the tornado belt too. Get the hint, people?
Anywhere can have a natural disaster. If you people don't have anything nice to say don't say anything at all.
To everyone in the Gulf Coast my thoughts and prayers are with you always.
Michele M, Tamaqua PA (Sent Mar 2, 2006 1:03:09 AM)
"Be forewarned. You can't expect the governement to keep compensating people for making poor decisions."
Like rebuilding Oakland after the earthquake in '89? Hmmmmmm?
H.Griggs (Sent Mar 2, 2006 2:32:13 AM)
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