Loans Impacting Grant Money for Sandy Victims

Toms River, N.J., resident Douglas Quinn in Newark, N.J., on Nov. 14, 2014, showing a photo of damage to his home after Superstorm Sandy. He says that his insurance company now says that the damage was pre-existing and refuses his claim. AP Photo/Mel Evans

Jordan Farkas at his home in Long Beach, N.Y. on Dec. 1, 2014. Some homeowners whose property was ravaged by Superstorm Sandy say they are being denied assistance from other programs because they took out low-interest federal loans right after the storm on the advice of federal workers. AP Photo/Seth Wenig

In New York, for instance, a hardship waiver is available to SBA loan recipients if homeowner expenses—mortgage, utilities and the SBA loan payback amount—are equal to or more than 30 percent of total household income.

Build it Back and New York Rising have approved more than 1000 waivers.

Jordan Farkas, a day trader who also breeds and raises horses, took a $14,000 loan after his Long Beach house was flooded and flood insurance would not cover many of his losses. He said he didn’t want a loan but was told repeatedly to apply in order to be eligible for future federal aid.

Farkas paid off the loan eight months later, in part because the loan payback amount, with interest, would surpass $28,000. The $14,000 he got in a loan was deducted from his New York Rising award.

“Loans are not benefits,” said Farkas, who has a wife and two children. “For us, especially for us, we took it and paid it right back. There was no benefit.”

From The Associated Press