In this 2-minute read:
- The deadline for PPP loan applications HAS BEEN EXTENDED to MARCH 31, 2021
- Important updates have made it easier to meet full loan forgiveness
- Extensions on payroll and rehiring deadlines, and EXCEPTIONS for 2021
IMPORTANT UPDATE FOR 2021: Congress has approved an extension of the PPP loan program until March 31, 2021, including “second draw” PPP loans for businesses that received PPP funding in 2020. Start your free PPP loan application now!
The PPP loan program as part of the CARES Act of 2020 was designed to provide emergency loans for America’s small businesses in crisis due to the coronavirus pandemic.
The initial PPP funding ran out, but the PPP program was re-funded for a second round of loan capital. The original application deadline for PPP loan applications HAS BEEN EXTENDED to MARCH 31, 2021.
You may still apply for your PPP loan but you absolutely must hurry. The deadline for PPP loan applications is now March 31, 2021.
On June 5, 2020, President Trump signed into law new updates to PPP loan forgiveness requirements, extending the covered period to 24 weeks, reducing the minimum loan funding that must be spent on payroll to 60%, and easing the requirements for maintaining staffing and compensation levels. Please read the details here.
Get your PPP loan or second draw PPP loan through Womply! Womply has helped over 200,000 businesses get their PPP funding. It’s free to apply for a PPP loan, and Womply can help connect you with an SBA lender that’s right for you! Start your PPP application.
It doesn’t cost anything to apply for a PPP loan
By law, it’s free for borrowers to apply for PPP loans. You should not be charged anything by your lender or loan facilitator to complete or submit your PPP loan.
If your local SBA-approved lender is no longer accepting applications, you can apply for free via Womply
Many larger banks may have stopped accepting PPP loan applications due to the new rules establishing a maximum amount of capital per PPP lender or for other reasons, but you can still apply elsewhere. We recommend you start your free PPP application here.
100% PPP loan forgiveness is now easier to achieve
The new Paycheck Protection Program Flexibility Act, signed into law on June 5, 2020, has lowered the minimum amount of PPP funds that must be spent on payroll to meet full forgiveness from 75% to 60%, extended the loan repayment deferment period, extended the deadlines for rehiring or repairing payroll cuts, and other important changes. Read more here.
For 2021, additional updates have made it even easier to get forgiveness for loans less than $50,000 and for businesses without employees. See details: What’s changed for 2021 in the PPP loan process?
For 2021 there are certain exceptions to the “maintaining employees levels and compensation” rule for PPP forgiveness
If you received a PPP loan of $50,000 or less
If you received a PPP loan that was $50,000 or less, you are exempt from having to maintain your employee and compensation levels in order to receive loan forgiveness. Your loan must still be spent on approved costs and you will still need to document that you spent at least 60% of your funds on payroll expenses.
An employee quit, retired, or was fired (with just cause), or refused your offer to be rehired
If your loan amount is greater than the $50,000 loan threshold and you have employees, but you couldn’t maintain employee levels due to someone quitting or being fired with just cause, then you can still qualify for full loan forgiveness. You can also get full loan forgiveness if you have written proof that you offered to rehire employees, but they refused your offer (if your offer was at their former pay). But, it’s very important that you document each of these instances so that you can verify this when you apply for loan forgiveness.
You’ll need documentation to explain why your employee was fired or other supporting documents to verify an employee’s termination or their refusal to be rehired.
Do I still need to restore payroll or headcount to previous levels in order to receive forgiveness if I get first PPP Loan after December 27, 2020?
No. PPP Loans received after December 27th, 2020 are not required to “rehire” any employees in order to receive forgiveness. You will, however, need to maintain current payroll levels during the forgiveness period. (Exceptions to this would include employees who resign or are terminated with cause).
If you’ve kept those requirements for the 8 (or 24) weeks after you received your PPP loan, at that point you may apply for loan forgiveness through the lender that serviced your loan.
In order to request any amount of forgiveness on your loan, you will need to verify that your loan was used for the required expenses, which means you’ll need documented proof.
Pros and cons of getting a PPP loan
It can be a hassle to get your PPP loan approved, depending on your loan facilitator or lender. And you do have to apply for forgiveness, but if you do, and you use the funding as intended, you don’t have to pay back your PPP loan… ever! Read more pros and cons of PPP loans here.
Helpful FAQs and articles about PPP loans
Here are some more articles and FAQs to help you learn more about PPP loans:
- PPP application document checklist
- Will applying for a PPP loan hurt my credit score?
- What expenses are forgivable under a PPP loan?
- How do I calculate my maximum PPP loan amount if I have employees?
- What’s the covered period for PPP loans? When does it start?
- How to get your PPP loan forgiven
- Can I still get a PPP loan if I’ve laid off employees or closed my business?
Let Womply help you apply for your PPP loans!
As you know, it’s free to apply for a PPP loan, and we know you have lots of choices. So why should you let Womply connect you with an approved SBA lender? Because we know what we’re doing and people love the help we provide. We’ve helped over 200,000 businesses, contractors, sole proprietors, and self-employed individuals get approved. Don’t wait! The deadline is March 31, 2021.
Learn more, plus get free reputation monitoring and customer insights when you sign up for Womply Free!