We're here to help.
Our team of COVID-19 experts can walk you through the forgiveness applications. Our consultations are:
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.
SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.
We have had a number of businesses contact us recently who have been concerned that their loan documents for the PPP require them to start making payments in the very near future. This is not the case.
The original CARES ACT contained language that made this true and if you received a PPP loan in the beginning of the process your lender would have included language in your loan documents that made this the case. However, the FLEXIBILITY ACT changed the payment schedule and deferred your first payment for a long time. Interest will accrue on any unforgiven portion of your PPP from the date you received a disbursement, but your first payment will not be due until much later in the process. Please note that if you received an EIDL Advance it will not be forgiven and will be treated as a PPP Loan.
We have found that many lenders have not formally notified businesses of this change and we know of no lenders that have taken the step of modifying the language in the PPP loan documents. Regardless, your first payment is not currently due. Here is language from the SBA that was issued in the form of a FAQ in early October.
Question: The Paycheck Protection Program Flexibility Act of 2020 (Flexibility Act) extended the deferral period for borrower payments of principal, interest, and fees on all PPP loans to the date that SBA remits the borrower’s loan forgiveness amount to the lender (or, if the borrower does not apply for loan forgiveness, 10 months after the end of the borrower’s loan forgiveness covered period). Previously, the deferral period could end after 6 months. Are lenders and borrowers required to modify promissory notes used for PPP loans to reflect the extended deferral period?
Answer: The extension of the deferral period under the Flexibility Act automatically applies to all PPP loans. Lenders are required to give immediate effect to the statutory extension and should notify borrowers of the change to the deferral period. SBA does not require a formal modification to the promissory note. A modification of a promissory note to reflect the required statutory deferral period under the Flexibility Act will have no effect on the SBA’s guarantee of a PPP loan.
Loan Forgiveness Application: "The Long Form"
PPP EZ Loan Forgiveness Application: "The Short Form"
Loan Forgiveness Application: 3508S (for amounts under $50,000)
Additional Loan Forgiveness Documents