The Small Business Administration (SBA) has extended the deadline for applications to the Paycheck Protection Program (PPP) to Aug. 8, 2020. Through the program, eligible small businesses can obtain loans from approved lenders on behalf of any eligible borrower. Businesses with fewer than 500 employees are eligible for assistance to keep employees on their payroll through the end of June.
The SBA has advised approved lenders to resume processing loan applications that were previously submitted by eligible borrowers as well as new applications, and to resume disbursing funds.
Under the PPP, a small business can receive a loan of up to $10 million, with a two-year term and a 1% interest rate. The loans will not require collateral or personal guarantees. Most importantly, up to 100% of the loan can be forgiven if the funds are used to maintain employee payroll.
IMPORTANT: Given the speed with which previously-appropriated funds were exhausted, we encourage prospective borrowers to work quickly with an approved lender to complete and submit their applications. Approved applications are funded on a first-come, first-served basis. Borrowers should nonetheless immediately check with their lenders on the status of their pending application and, if no application has been submitted, submit their application via the SBA’s PPP webpage.
Banks have recently received guidance from the federal government and are currently working to get the program into place. Visit SBA.gov for more information.