SBA UPDATES —
PPP Loan Information
On May 4, 2021 the Small Business Administration (SBA) informed trade associations that Paycheck Protection Program (PPP) funding had been exhausted and that the PPP application portal stopped accepting applications on May 4, 2021, for loans from most lenders.
SBA stated that it has reserved approximately $6 billion in funding for previously submitted loan applications subject to hold codes that have yet to be resolved. There is also approximately $8 billion remaining in congressionally mandated funding for PPP loans made by designated “community financial institutions,” defined for bankers’ purposes as minority depository institutions and community development financial institutions.
“For more than a year, banks of all sizes and their dedicated employees have worked day and night to ensure these critical funds reach as many small businesses affected by the pandemic as possible, accounting for 74 percent of the 10.8 million loans issued and 91 percent of the $780 billion in PPP loan dollars to date,” said American Bankers Association spokesman Ian McKendry. “Those bank efforts to help small business customers will continue. With the portal closed to most lenders, America’s banks will remain focused on helping borrowers still in the pipeline resolve SBA hold codes and other outstanding loan issues, so they can receive their PPP funds.”
Understanding —
Loan Forgiveness
Loan forgiveness will be similar to the first round with 60% or more of your loan amount needing to be spent on payroll expenses. SBA has been directed to provide a simplified process for applying for forgiveness.
For —
Borrowers at or Under $150,000
For PPP loans of $150,000 or less, you may use 3508S.
*However, if you and your affiliates have together received PPP loans totaling $2,000,000 or more, you must use the 3508EZ or the 3508 Application.
****Certain business entities (which could include farmers, partnerships, and seasonal employers) may increase their 2020 PPP Loan. If you plan on applying to increase your 2020 PPP Loan - DO NOT complete this forgiveness form. Once your 2020 PPP Loan is forgiven, the SBA does not allow that loan to be increased.
For Potential —
Borrowers Over $150,000
For PPP loans over $150,000, you may use 3508EZ, IF you meet ONE of the following conditions:
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Are self-employed and have 0 employees; OR
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Did not reduce the salaries or wages of your employees by more than 25%, and you did not reduce the number or hours of your employees; OR
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You have experienced reductions in business activity as a result of health directives related to COVID-19 and did not reduce the salaries or wages of your employees by more than 25%.
If you do not meet ONE of the above standards for 3508EZ, you must use the 3508 “Revised” Application. The regular form 3508 is a more complex document and therefore, we suggest you seek professional assistance when filling out this form.
****Certain business entities (which could include farmers, partnerships, and seasonal employers) may increase their 2020 PPP Loan. If you plan on applying to increase your 2020 PPP Loan - DO NOT complete this forgiveness form. Once your 2020 PPP Loan is forgiven, the SBA does not allow that loan to be increased.
Paycheck —
Protection Resources
Paycheck Protection Program Frequently Asked Questions (FAQs)
Paycheck Protection Program
Availa Bank is proud to help small businesses across Iowa during the coronavirus crisis. In the first round of PPP, we issued 871 loans to help businesses keep workers on the payroll through the Paycheck Protection Program. More than 30% of these loans have been for less than $10,000 and are critical to the small businesses in our communities.
Thank you to our branch employees who made this possible.