PPP Forgiveness Series, Part 4: Final Advice

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Parts 1 and 2 of the BBVA USA Forgiveness Webinar described two key elements of the whole process: Lender Obligations and the Obligations of the borrower. Part 3, meanwhile gave a visual timeline which indicates key milestones related to a business owner’s PPP loan.

The details of all three parts can be found in the main Forgiveness series resource: the BBVA USA forgiveness webinar, a comprehensive Check out the PPP that untangles common questions. You can find all three parts here:

Launched in April, the PPP was the Small Business Support component of the CARES Act, which was developed in response to the COVID pandemic. The PPP enabled businesses with 500 or fewer employees to borrow money from lenders, guaranteed by the US Small Business Administration (“SBA”), to save 2.5 times their average monthly payroll and other expenses, including mortgage interest, Rent payments and utility payments to finance.

If full-time equivalent employees have been retained throughout the period covered and certain other conditions are also met, companies may be eligible for waiver of their PPP loan balances.

In May, BBVA USA announced that it had received funding Approximately $ 3.3 billion in small business loans in less than 60 days, processing more than 22,000 applications and impacting around 360,000 jobs through his efforts in the PPP. Given the bank’s level of exposure to the PPP, the bank’s total SBA 7 (a) lending for the fiscal year ended September 30, 2019 was 259 loans totaling nearly $ 270.7 million The bank awarded the No. 14 nationwide in dollar volume for SBA loans.

A short list of the FAQs submitted for the webinar can be found below. For a full list of frequently asked questions, see Click here.

Q: I have been told that I have to use the money by a certain date. Is that true?

Answer: yes. Either within the 8-week coverage period or the alternative 24-week coverage period from the PPP loan disbursement date.

Q: An employee quit during the covered period. How do I calculate that?

A: Please refer to the 6 full-time equivalents (FTE) reduction exemptions from the SBA (Page 12), which also includes cases in which employees have voluntarily resigned. FTE reductions due to any of these 6 exemptions will not reduce the borrower’s eligibility to waive a loan.

Q: I am aware that there is a simplified award procedure for smaller loans. Is that true?

A: As of now, no. However, laws have been put in place that can simplify the waiver process for loans up to $ 150,000. We cannot speculate about whether or when that could happen. When new laws or guidelines are made available, we will update our portal and communicate the new process as soon as possible thereafter.

Q. Will the repayment term be adjusted for loans submitted under the CARES Act?

A. All PPP loans granted on June 5, 2020 and later have a term of 5 years. Loans granted before June 5, 2020 have a term of 2 years, unless the customer and lender mutually agree to adjust the term to five years.

Q: I have not been able to reopen my business. Does the loan depend on the reopening?

A. Please note Safe Harbor of RTD Reduction of the SBA 1 (Page 10), which is aimed at companies that cannot operate at the same level as before February 15, 2020 during the covered period due to compliance with requirements or guidelines published between March 1, 2020 and March 31, 2020 December 2020 by the secretary of. Health and Social Services, the Director of Centers for Disease Control and Prevention, or the Occupational Health and Safety Authority on compliance with standards of hygiene, social distancing or other safety requirements for workers or customers related to COVID-19.

Click here for the full webinar.

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