Many borrowers who received the Paycheck Protection Program (PPP) loans under the CARES Act are understandably restless to apply for loan forgiveness. There are are many factors affecting the forgiveness application process such as:
- Most lenders do not have the technology in place to process the forgiveness applications. Until the Small Business Administration and the U.S. Treasury Department issue final guidance the lenders can not fully develop their online portals.
- Payroll providers are still developing custom reports to deliver the information needed to comply with PPP requirements.
- Given the 24 week covered period option, borrowers have more time to qualify for loan forgiveness.
- Borrowers aren’t required to make any loan payments before they apply for forgiveness or until 10 months after their covered loan period ends.
Borrowers can take steps to be prepared for the forgiveness application process by documenting how the proceeds are used and gathering documentation needed to support non-payroll costs.
We will continue to provide updates as the SBA and Treasury Department release guidance. If you have any questions please reach out to our office.