Peak Series – COVID19: PPP SBA Loan New 1502 Reporting and Forgiveness (Part III)

In our previous two blogs from this three-part series on SBA PPP loan servicing, we’ve discussed the SBA’s requirements for PPP loan reporting and processing fees. This final blog will review the forgiveness portion of the PPP loan cycle. Although forgiveness is our final focus, keep in mind PPP loan opportunities still remain open. With the latest signing of the PPP loan Flexibility Act enrollment remains open until June 30th.
A few new changes as a result of the new Flexibility Act are the following:

• Loans approved after June 5th will have a 5-year loan maturity instead of the 2 years that applies to loans approved prior to June 5th

• The covered period for loan forgiveness has been extended from 8 weeks to 24 weeks, providing substantially greater flexibility for borrowers to qualify for loan forgiveness

• Lowers the requirements that 75% of loan proceeds must be used for payroll costs to 60%

• Provides safe harbors from reductions in FTE’s for various scenarios

As of a June 8th publication, the PPP loan program approved 4.5 Million small business loans totaling over $500 Billion, to ensure 50 million hardworking Americans stay connected to their jobs.

Peak Consulting is testing a variety of scenarios to help automate loan forgiveness payments as well as remodeling remaining payments for loans that do not have complete forgiveness. If you would like more information on automating changes to your PPP loan portfolio contact us today!