The House and Senate approved changes to the Paycheck Protection Program that is now headed to the President for signature. The changes are more favorable for PPP Borrowers.
It is important to note, once the President signs the new legislation, the final rules still need to be written by the Small Business Administration. This means that complete clarity on the forgiveness process may not be known for several days. Once those rules are written and a new Forgiveness Application is published the SBA, Platinum Bank will communicate with all PPP Borrowers to ensure a smooth forgiveness process.
Full details may be found here: https://www.congress.gov/bill/116th-congress/house-bill/7010?overview=closed.
Following are a few highlights:
- The “covered period” is extended from 8 weeks to 24 weeks. This allows business more time to spend the loan proceeds for eligible costs.
- Increases cap on non-payroll expenses to 40%, which lowers the payroll expense requirement to 60%.
- Extends the period to when a business can apply for forgiveness to 16 months, which is 10 months after the covered period ends. There will be no payment of principal or interest due during this period.
Your Relationship Managers and the entire Platinum Team are here to assist you as needed.