Insider has been tracking the SBA’s Payroll Protection Loan Program as so many of us owner/operators have taken advantage of the loans available through and administered by the banking community. We mentioned back in August that waiting on filing your forgiveness application would make sense as lawmakers were discussing the option for forgiveness of all PPP loans less than $150,000 with the completion of a simple, one-page forgiveness document.

As most of you know, negotiations for another Covid relief bill have stalled and though the White House and Congress have indicated some interest in continuing discussions, it doe not look like anything will be resolved before the election.

However, instead of waiting on Congress, the U.S. Small Business Administration, along with officials from the Treasury Department, recently released a three-page questionnaire that should make it easier for businesses to answer the questions necessary to convert the loans into grants that will not have to be paid back. Unfortunately, this new interim procedure is only for loans of $50,000 or less, but this may start the ball moving forward and possibly inclusion of larger loan balances.

To provide some perspective here is a quote from the CEO of a local community bank located in the Pacific Northwest.

“It’s a step in the right direction. It’s still not perfect, but something we can go on,” he said. “But it needs to be higher. If you did it for $150,000, that would be 83% of all the loans we made.”

In any event, the banking community is reviewing the proposed rules and we expect they will be reaching out to their Borrowers in the near future.

If you want to get ahead of the curve and read up on the new interim rules here are the links for the different documents.

Additional Revisions to Loan Forgiveness and Loan Review Procedures Interim Final Rules

PPP Loan Forgiveness Application Form 3508S

PPP Loan Forgiveness Application Form 3508S Instructions

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