By: Alan Gasman and Brandon Ketron
The Small Business Administration (SBA) has made a number of updates to the rules governing the PPP loans it is receiving from borrowers and their advisors. These new rules will save tens of thousands of hours for borrowers, accountants, banks and the SBA.
Brandon Ketron, JD, CPA and I have the following website to watch this Saturday:
Brandon and I will also be punishing the owner’s employees if there are any surviving family members who have written about the new Retirement Credit Guidelines for the recent announcement 2021-49.
The main changes are as follows
Adjusted entry system for borrowers receiving less than $ 150,000
Probably the most important change yesterday (August 4) was the highly anticipated online portal, with small businesses borrowing up to $ 150,000 able to apply for debt relief. This portal is currently being managed by SBA through private lenders to facilitate the debt forgiveness process. These changes took effect on July 28, 2021 (two days before the rules and regulations were amended).
The most significant part of the new amendment process is the “opt-in” option for processing credit applications. Lenders now have their own internal collection of loan forgiveness applications, which are then required to be approved by the SBA. This discount is available to borrowers totaling $ 150,000 or less. Apparently 93% of the PPP. Borrowers fall into this demographic structure, so this is a welcome news for many small business owners.
By going directly into the borrower’s pardon process, all lenders with less than $ 150,000 can apply for a Form 3508S online at the online entrance. Once that form is submitted, the lender can review the application and submit an apology to the SBA, all through the online portal.
Borrowers who have previously apologized for loans of less than $ 150,000 are at risk of overstretching applications through the new platform.
Borrowers should be aware that it is not mandatory to use the new platform. In fact, many large lenders have not yet come up with a better set of applications. In these cases, borrowers must continue to file loan applications directly with their creditors. Improvement applications have been successfully completed for thousands of small businesses struggling with logistics.
Many high PPP borrowers can “guarantee” a 25% reduction in income using a special grading system.
The provisional final rules also introduce the CVID deduction effect that will be used during the amnesty to record the income reduction required to qualify for a second Draw PPP loan. To qualify for a second drug PPP loan, the borrower has to pay a. Compared to the same quarter in 2019, revenue for any 2020 calendar year was expected to fall by more than 25%.
Borrowers with a loan of less than $ 150,000 are allowed to verify this deduction on their own and do not have to submit documents with their original loan application until a loan waiver has been made. Designed by an independent third-party contractor, the new Covenant revenue reduction will include a variety of inputs such as industry, geography and business size. If the total point meets the income reduction requirements, the borrower will not be required to provide any additional documentation, and regardless of the actual income of the business, he may rely on the VV deduction result to meet the 25% income reduction requirement.
As long as this new CVD deduction effect applies to the provisional final rule, it can be used for secondary PPP loans that the lender has not yet decided on a SBA loan pardon.
Special delay in repayment of debtors on appeal
The new provisional final rules also extend the loan repayment delay for borrowers who appeal the final SBA loan review decision with the SBA Court and Appeals Office (OHA). If the borrower makes a timely appeal of the final SBA loan review decision, the borrower will not be required to repay their PP loan until the final decision is made by the OHA.
These changes follow a recent update other than SBA. PPP with $ 2 million or more in loans as of October 2020 Borrowers are required to complete Forms 3509 and 3510. This questionnaire includes basic information such as gross income, contact information, and the impact of the Covs epidemic on business. Operations, and creditors’ liquidity assessment. Starting July 29, 2021, the SBA has stopped asking for forms.
This decision is based on the belief that public audit resources will be better managed in other areas. The inquiries led to unnecessary delays for the borrowers, and subsequently reduced the cost of the entire program. All PPP loans worth more than $ 2,000,000 are regulated by SBC, so the SBA’s question of the need for a loan can still be useful for large borrowers, as it provides guidance on the questions it may ask in the review. With loan forgiveness applications.
We hope this will be a little relief for the big borrowers who are not affected by the new online portal.