For owners of small and medium sized businesses who haven’t applied yet for the PPP or Paycheck Protection Program must apply via eligible lender similar to a local bank. It is recommended to visit the website of SBA or Small Business Administration for they have complete list of eligible lenders. Experts do say that business owners must apply through banks with whom they currently have relationship with.
This is because banks are already doing its best in helping their current clients in managing the Covid-19 pandemic and might be reluctant to work with new clients. Also, banks should vet new clients, which is something that might take some time.
As for the applicants, it will be a necessity to submit an SBA Form 2483 or the Paycheck Protection Program Application Form as well as payroll documentation.
What other Things are Needed?
The new bill is almost the same with the old legislation but 60 billion dollars of this is focused at small and medium sized banks and credit unions with around 30 billion dollars that were set aside for the community-lenders such as:
- Community Development Institution and;
- Minority Depository Institutions
The changes were enacted after the critics of first round said that there’s too much money being funneled to bigger businesses similar to major restaurant chains instead of the startups and really small businesses.
According to Steven Hamilton, the assistant professor of economics at George Washington University says that it is hard to say in advance whether or not the modifications in second round would make it simpler for small businesses to apply for PPP loans.
Well, if you are having a hard time securing a loan through PPP, there are still other businesses that offer loan products that you can take such as https://www.southeasttitleloans.com/south-carolina-regulations/.
With PPP, businesses that have at least 500 employees will be able to receive loans for 2.5x of their monthly payroll costs with a ceiling of 10 million dollars. The loan could be forgiven in the event that the business uses at least 75 percent of forgiven amount for payroll and also, if the money has been used for interest, mortgage, utilities, rent and payroll.
Does the PPP Loan can meet the Substantial Demand?
A straightforward answer to this is, NO. while many more businesses will certainly get PPP funding on the next round, some may be left behind, particularly those that didn’t have preexisting relationship with banks.