Many businesses applying for loan forgiveness were shocked when they saw an October 31st deadline listed on the upper right corner of their application forms. With so much uncertainty about the actual deadline, the Small Business Administration (SBA) released extra guidance to ensure business owners had the right deadline dates expected to submit their loan forgiveness applications.
When Is My Application Due?
After much confusion surrounding the actual due date, the SBA released this guidance to all who are in the process of submitting for loan forgiveness. Listed under FAQs, businesses will see that the SBA explains “borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from the loan’s origination, depending on the borrower’s agreement.” Within this newly added guidance, the SBA also reminds borrowers “that loan payments are deferred only until 10 months after the last day of each borrower’s loan forgiveness covered period.” This was a relief to small businesses that began rushing to complete their applications, believing they needed to be submitted by the end of October 2020.
What Is A PPP Loan
As COVID-19 brought many shutdowns throughout cities in the US, many businesses were struck with a struggle to stay open, follow strict guidelines, or shut down and let go of their staff. To protect these small businesses facing financial turmoil, initial funds of $350 billion, and later an additional $320 billion, were signed into law as part of the CARES Act. The Paycheck Protection Programs loans (PPP Loans) were aimed to help struggling businesses and provide an incentive for them to stay open.
How To Apply For A PPP Loan Forgiveness
Those who are ready to apply for PPP loan forgiveness must do so through their lender. Applications can be found directly through the SBA’s website, which lays out everything needed to be considered for loan forgiveness.