Please review this information in its entirety before attempting to apply for forgiveness for your Small Business Administration (SBA) Paycheck Protection Program (PPP) loan.
First Federal Bank Process
The Paycheck Protection Program Flexibility Act (PPPFA) of 2020 was signed into law on June 5th. Among the changes made by the PPPFA are:
- increasing the amount of loan proceeds able to be spent on non-payroll costs from 25% to 40%;
- extending the “covered period” during which borrowers can spend forgivable expenses from 8 weeks to 24 weeks (although borrowers can choose to use the original 8 week period);
- extending the loan maturity date on post PPPFA loans from two years to five years; and
- extending the deadline for rehiring employees to December 31, 2020 (up from June 30, 2020).
On June 17th, the SBA released additional guidance pertaining to the PPPFA, including an update to the PPP loan forgiveness application. There are now two separate application forms which reflect borrower-friendly changes to the forgiveness calculations contained within the PPPFA. While these are positive changes for most borrowers, there is additional guidance pending related to open questions regarding how forgiveness will be determined for certain borrowers.
We continue to encourage you to check the SBA Website regularly for the most up to date information.
All credit products are subject to approval.