PPP Application Dates Announced
The application window for Paycheck Protection Program (PPP) forgivable loans will open Friday for lenders with $1 billion or less in assets, the US Small Business Administration and Treasury announced. The opening, which will take place at 9 a.m. ET and applies for both first- and second-draw PPP loans. The program will begin accepting applications for first- and second-draw loans from large lenders on Tuesday, Jan. 19.
PPP reopened Monday initially for community financial institutions (CFIs) to make loans to first-time PPP borrowers. CFIs were allowed to make second-draw loans to previous PPP recipients starting Wednesday.
CFIs typically work with underserved small businesses. SBA and Treasury granted the initial early access to PPP so these small businesses, which include many minority- and women-owned concerns, could get first crack at accessing the $284.5 billion in PPP funding approved in the part of the $900 billion COVID-19 relief bill that was signed into law on Dec. 27.
PPP Funding, Forms, and Guidance
Quick Overview of the New PPP
The loans are capped at $10 million for first-time borrowers and $2 million for second-time PPP borrowers.
PPP first- and second-draw loans may qualify for forgiveness if the funds are used on the following eligible costs: payroll, rent, covered mortgage interest, and utilities, covered worker protection and facility modification expenditures, covered property damage costs, covered payments to suppliers, and payments for business software or cloud computing services that facilitate business operations, product or service delivery, and a number of back-office functions, including accounting.
To be eligible for full loan forgiveness, PPP borrowers must spend no less than 60% of the funds on payroll over a covered period of their choice between eight and 24 weeks.
Borrowers are eligible for a second-draw PPP loan of up to $2 million, provided they have:
First time PPP loans are available to borrowers that were in operations on Feb. 15, 2020, and are from one of the following groups:
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