S. 397 · Where this bill is now
In committee
Introduced in the Senate, Feb 4, 2025
What this bill does
In plain words · AI-written from the official summaryRaises collateral threshold for disaster loans
When disaster strikes, the Small Business Administration can lend money to help businesses recover. Right now, the SBA can require collateral (something of value you put up as security) for loans over $14,000. This bill raises that threshold to $50,000, meaning more disaster loans won't require collateral. The bill also requires the SBA to pay special attention to rural communities when marketing these loans and to address obstacles those communities face in accessing them. Finally, a government watchdog agency has to track how well these loans perform and how often borrowers default.
How it affects you
Small business owners in disaster areas could see real benefits, especially those in rural communities. If your business needs a disaster loan under $50,000, you won't have to pledge collateral to get it, which makes borrowing easier. Rural communities will get more targeted outreach about these loans and the SBA will work to remove barriers that kept rural businesses from accessing them in the past.
Read the official summary (Introduced in Senate, Feb 4, 2025)
Small Business Disaster Damage Fairness Act of 2025
This bill increases from $14,000 to $50,000 the threshold loan amount over which the Small Business Administration (SBA) may require collateral for a disaster loan.
The Government Accountability Office must report on the performance, including the default rate, of such loans.
Additionally, the SBA must (1) distinguish between rural and urban communities in the outreach and marketing for disaster loans, and (2) incorporate actions to mitigate challenges encountered by rural communities in accessing such loans.
Written by AI (Claude) using only the official summary by the Congressional Research Service, the Library of Congress’s nonpartisan research staff. It can miss nuance, so check the official summary and the bill text for details.
1st SessionS. 397
A BILL
Small Business Disaster Damage Fairness Act of 2025
Sponsor: Sen. John Kennedy (R-LA) · Introduced Feb 4, 2025 · Commerce · 1 version of the text
Sources: Congress.gov actions and votes · bill text from GovInfo · latest official action Feb 4, 2025: “Read twice and referred to the Committee on Small Business and Entrepreneurship.”