On June 30, 2020 U.S. Senators Kevin Cramer (R-ND), Bob Menendez (D-NJ), Thom Tillis (R-NC) and Kyrsten Sinema (D-AZ), Senate Banking Committee members, introduced the Paycheck Protection Small Business Forgiveness Act. This bipartisan legislation seeks to streamline forgiveness of Paycheck Protection Program (PPP) loans for small businesses by automatically forgiving all loans under $150,000.
What the Bill Says…
If this new legislation is signed into law, the PPP loan forgiveness process for loans under $150,000 would be reduced to a one-page attestation form to be completed by the borrower, and submitted to the lender. The lender would also be held harmless from any enforcement action if the borrower’s attestation contains falsehoods.
The impetus for the legislation is to reduce the documentation and cost burden for the smallest businesses to pursue and obtain forgiveness. Under the current forgiveness process a borrower must complete either the PPP Loan Forgiveness Application Form 3508EZ if these qualifications are met, or the much lengthier Form 3508 if the borrower doesn’t qualify to use the Form 3508EZ. It is also estimated that the cost for a small business with a PPP loan under $150,000 to apply for forgiveness is $2,000, and it would cost the lender $500. If approved, this bipartisan legislation could save small businesses $7.4 billion and banks nearly $2 billion.
Where to Get a PPP Loan
Your local bank is a great place to apply for your PPP loan, as small and regional banks have been very successful processing and obtaining PPP loans for their clients. If you don’t have access to a local bank, or would prefer an easy, automated application process, then the below PPP loan providers are an excellent option.
Fundera is one of the largest online business loan marketplaces in America and has provided in excess of $2 billion to over 50,000 small businesses. The firm was also one of the first technology-based loan providers to implement an effective PPP loan application and processing system. Through its proprietary technology, Fundera has streamlined the PPP loan process enabling even the smallest of businesses to apply for, and obtain a PPP loan from its extensive network of approved lenders.
Lendio has been highly successful in processing and facilitating PPP loans through a user-friendly, technology-based platform. Via its unique software, and deep lending relationships, the firm has obtained over $8 billion of PPP loan approvals for over 100,000 small businesses. It also has a relatively low average loan size of $73,000, compared to other banks and lenders more focused on processing applications for larger businesses.
If you’re one of the approximately 4.2 million small businesses that have been approved for a PPP loan of $150,000 or less, then there is a chance that your forgiveness process could get a lot simpler. If you haven’t received a PPP loan yet, the program is open until August 8, 2020 so there is still time to apply. Fundera and Lendio offer easy online PPP loan applications, and have been successful at providing billions of dollars of PPP financing to small businesses.
Don’t hesitate to contact us if you are unsure of which financing option is the right choice for you, or if you need additional lender recommendations beyond those mentioned in this article.