IncredibleBank is an SBA Preferred Lender which grants us authority to provide Paycheck Protection Program (PPP) loans, as outlined in the Coronavirus Relief, Aid, and Economic Security Act (CARES Act). We take this responsibility with enthusiasm and seriousness as we understand this is a time of stress for small businesses, their employees and our communities. The Paycheck Protection Program (PPP) closed to new applicants on August 8, 2020.
To provide you with the best possible experience we are staging our application intake. We will be reaching out to our PPP customers over the coming months to provide a link to your unique forgiveness application. We are timing the application submissions to ensure we achieve our #1 commitment to review and submit all forgiveness applications to the SBA within 30 days of receipt. Our goal is to forgive all applications before the end of 2020.
Applications will be accepted via our digital channel only. Once you receive the link from us, please take the steps to submit your application.
IFR #25, Additional Revisions to Loan Forgiveness and Loan Review Procedures (issued on Oct 7, 2020), provides new guidance regarding a simplified forgiveness process for loans of $50,000 or less. A borrower that received a PPP loan of $50,000 or less may use the newly issued forgiveness application form, PPP Loan Forgiveness Application SBA Form 3508S. In addition these simplifications, a borrower eligible to use the simplified form is exempt from any reductions in its loan forgiveness amount based on either reductions in full-time equivalent (FTE) employees or reductions in employee salary or wages.
October 7, 2020 - The Small Business Administration and Treasury Department updated the Paycheck Protection Program FAQs to address the deferral period extension granted by the PPP Flexibility Act of 2020. The extension allows borrowers to defer payments of principal, interest and fees on PPP loans for 10 months. The FAQ’s have been updated to address this – see question #52.
Additionally, the SBA informed us this week that it has begun remitting PPP loan forgiveness payments!
June 22, 2020 - IFR #20 clarifies that a borrower may submit a loan forgiveness application any time on or before the maturity date of the loan – including before the end of the covered period – if the borrower has used all of the loan proceeds for which the borrower is requesting forgiveness.
June 17, 2020 - the Small Business Administration (SBA) and the Treasury Department released updated, streamlined applications to reflect recent changes made by Congress in the PPP Flexibility Act:
- PPP Loan Forgiveness Application Revised June 16, 2020 (Form 3508)
- PPP Loan Forgiveness Application Revised June 16, 2020 (Form 3508) – Instructions
- PPP Loan Forgiveness Application (Form 3508EZ)
- PPP Loan Forgiveness Application (Form 3508EZ) – Instructions
The “EZ” application requires less documentation and fewer calculations for borrowers who meet any one of these three criteria:
- Applied for the PPP loan as self-employed, an independent contractor or a sole proprietor with no employees.
- Did not reduce salary or wages for any employee by more than 25% and did not reduce the number or hours of their employees (except laid-off employees who refused an offer to return).
- Did not reduce salary or wages for any employee by more than 25% during the covered period and experienced reductions in business activity as a result of health directives related to COVID-19.
June 5, 2020 - the Paycheck Protection Program Flexibility Act passed. The following are some highlights of the positive changes:
- Extends from eight to 24 weeks the amount of time borrowers have to spend PPP funds while remaining eligible for forgiveness. Borrowers who have already received PPP loans have the option to use the original eight-week covered period OR the 24 weeks. Note If the 24-week covered period is used, then the FTE counts and salary/wage levels are measured during that entire 24-week period, even if the PPP funds are no longer being used because they were exhausted.
- Lowers the amount that must be spent on payroll costs from 75% to 60%.
- Provides two safe harbors from reductions in loan forgiveness based on reductions in full-time equivalent employees and for borrowers that are unable to return to the same level of business activity the business was operating at before February 15, 2020.
- Replaces the six-month deferral of payments due under PPP loans with deferral until the date on which the amount of loan forgiveness is remitted to the lender.
- Establishes a minimum maturity of 5 years for PPP loans made on or after June 5, 2020
- Frequently Asked Questions (10/7/2020)
- Frequently Asked Questions on Loan Forgiveness (10/13/2020)
- SBA Paycheck Protection Program
- U.S. Treasury Department PPP Page
Contact your business banking officer directly or submit your PPP questions to PPP@incrediblebank.com.