In this 3-minute read:
- Where do I check my PPP loan status?
- Who is involved in the PPP loan application/approval process?
- Possible reasons for PPP loan delays
- Could my PPP loan still be delayed even if I did everything right?
- Will my lender let me know if there’s a problem with my PPP application?
As we surpass $650 billion in PPP stimulus loans issued and are coming up on the current extended application deadline of May 31, 2021, a lot of small business owners, independent contractors, sole proprietors, and eligible self-employed individuals are worried that their PPP loan won’t get processed and approved before the program runs out of money or the deadline passes.
Many people wonder how they can check on the status of their PPP loan application. Let’s go over some of the key issues.
How and where can I check my PPP loan status?
Currently the SBA has no facility for borrowers to check the status of their PPP loans. In fact, contacting the SBA is discouraged since it may slow down the process, and you will likely not get a response.
If you applied for your PPP loan via Womply, you can check loan application status at https://www.womply.com/ppp-status/. If you did not apply through Womply, you will need to contact your SBA-approved lender and request a status update.
You may also like: How long does it take for my PPP application to be approved and funded?
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Understanding the parties involved in the PPP loan process
When discussing loan status updates or delays, it helps to know who is involved in the PPP loan application and approval process. There are three entities directly involved in PPP loans:
1. You (the applicant/borrower)
The entity, business, or person applying for a PPP loan. (Example: a self-employed person, an LLC with employees, an auto shop, a farmer, a salon, an eligible non-profit organization, an independent contactor, etc.)
2. Your SBA-approved lender
For PPP loans the SBA authorizes over 5,000 lenders across the country to accept and process applications, and distribute PPP funding to borrowers. (Example: a bank, credit union, community lender, etc.)
3. The Small Business Administration (SBA)
The SBA is the government agency that administers the Paycheck Protection Program (PPP). They receive applications from your lender, review every application for accuracy and eligibility, and let your know whether your application is approved or rejected.
What are some common causes for PPP application or approval delays?
The most common cause of PPP loan delays is mistakes on the part of the borrower/applicant. The most frequent reasons your PPP loan may be delayed include: Problems with basic information on the application, such as mismatched or incorrect business info (addresses don’t match, etc.), incorrect tax ID (Social Security Number, EIN), or a mistake in the PPP First Draw SBA loan number (or missing) when applying for second-draw loans.
There may also be issues if you provide incorrect or insufficient documentation during the application process. For example: a 1099-MISC does not satisfy the requirement for a 1040 with Schedule C for self-employed/independent contractors, and a Schedule C alone is not sufficient without your 1040 return.
You must also be sure to provide a high-quality digital scan of all documents. If it can’t be read correctly by your lender’s application software then your application will definitely be delayed and will possibly be rejected.
Also, believe it or not, some PPP loans are delayed simply because the borrower got distracted or otherwise neglected to actually complete the full application process and forms, review it, and sign it (usually this is an electronic signature for today’s SBA lenders). You are responsible for making sure you get through the entire process and submit your application form and documentation to your lender.
Could my PPP loan still be delayed even if I did everything right?
While borrower errors are by far the biggest sources of PPP loan approval delay, issues at the lender or SBA level are also possible.
At the lender level, there may be delays if your application is more complex than most. Complicated applications require more vetting and take more time. In addition, if you provided anything other than the requested documentation to substantiate your claims of revenue or losses, employment records, etc. there will likely be some delay while your alternative documents are examined and approved by several parties within the lender’s organization.
At the SBA level, delays are possible for several reasons. There are millions of people applying for PPP loans, and the SBA has to review and approve approve every one. There may be some delays simply due to demand. Generally, though, the SBA is fairly timely on getting applications reviewed and approved within a few days.
Another potential source of delay is increased scrutiny at the SBA level. The SBA was criticized for having an unacceptable rate of PPP fraud for loans issued during 2020. The changes they instituted this year to prevent fraud have increased the time it takes for them to process loans. As a result, even perfect applications often take a few days once they reach the SBA for approval. If there are errors with the borrower’s application, then these delays can increase significantly.
Will my lender inform me if there’s something wrong with my PPP application?
This is a hard question to answer. The issue is that all lenders must comply with their legal requirements and internal processes when communicating with applicants. Since the SBA allows some flexibility among their approved lenders, all of which may have slightly different internal processes and legal requirements, this may result in your lender not being able to inform you about every aspect of your application/approval process.
Under the law, there’s very little that lenders can tell you about your own application once it’s been submitted. One example is if your lender feels you aren’t eligible for a PPP loan based on your application, your lender may not be able to let you know up front. They may not want to risk any liability if their evaluation was incorrect. This can create frustration for applicants who mistakenly believe they’re eligible for PPP loans but continue to be declined and told by that lender something like, “you may be able to re-apply elsewhere.”
It’s important to note that it’s up to you as the borrower to accurately determine your eligibility, understand the rules, and apply correctly.
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