Those who have received payment protection program loans and don’t want to be stuck with repayments should seek forgiveness from their lenders or through the Small Business Administration’s Direct Borrower Forgiveness Portal.
The deadlines for requests for forgiveness are set individually.
“The first payment for this note will be due 10 months after that date from the day the PPP loan is created, signed and funded,” said Terry Lockhart, chief lending officer for the Bank of Cherokee County. “Basically, they have eight to 24 weeks to spend and distribute the money. At the end of those eight to 24 weeks, they have 10 months from the time of signing to seek forgiveness without having to make a payment. “
For example, if the covered period – eight to 24 weeks – for the PPP loan ends on October 30, 2020, the deadline for the waiver application would be August 30, 2021. Around 85 to 90 percent of borrowers at BCC have already had their loans waived in full.
“I know a lot of banks aren’t that big,” Lockhart said. “There are a lot of them that are nowhere near that point, but we have a pretty good process and we started early.”
Those who are unsure when to apply for forgiveness should check with their bank or lender. It will prevent them from having to return the disaster dollars and it will also benefit the bank.
“From a bank perspective, we want it to be given and taken off the books because we borrowed 1 percent,” said Lockhart. “The faster we are given the loan, the faster we can lend 4, 5 or 6 percent of the money and get a better return for the bank.”
Lockhart advises borrowers to fill out their forgiveness requests as soon as possible and convert them to their lender.
“Because right now the pandemic and everything that’s going on is still fresh,” he said. “I would just think that in time you will forgive them, but I want to be at the top and not wait for the end hoping that I will be forgiven.”
Individuals who have received a PPP loan can also use the SBA’s direct lending portal, which opened on August 4th. Borrowers can use a computer or smartphone to file apology forms. On average, users submit their applications within six minutes and received their award decisions within a week from the time of submission. So, borrowers do not need to contact their local lenders with whom they have issued their loans.
“We are thrilled that the Direct Borrower Forgiveness Portal is giving small businesses a streamlined, easy-to-use way in just two weeks to apply for remission and get relief on these important PPP loans,” said Patrick Kelley, deputy administrator of SBA’s office for capital access. “We have seen hundreds of thousands of borrowers navigating the process quickly and easily, and we continue to proactively help borrowers apply through extensive public relations and webinar training.”
Of the 340,000 applications submitted through the portal, half have already been granted a total or partial waiver, totaling more than $ 2.4 billion. Borrowers whose loans are through banks that have chosen not to opt for the SBA’s direct remission portal must apply for a remission through their lender.
Further information on the SBA’s procurement portal can be found at www.sba.gov.