TThe COVID-19 pandemic has wreaked havoc on our lives over the past few years, like the United States and the whole world came to a standstill due to the lockdowns imposed worldwide.
One of the hardest hit groups have been small owners, who have been forced to shut down their operations following lockdown and other Covid-related mandates.
What are PPP loans?
Introduced in March 2020, the PPP emergency loan program was established as part of the $2 trillion CARES Act. The law authorized the distribution of more than $600 billion in forgivable credit to small businesses to help them weather the pandemic and mitigate their losses.
The loans were disbursed in two rounds, with most business owners receiving up to 2.5 times their monthly payroll costs based on their 2019 and 2020 tax returns.
Although the program officially ended in May 2021, small business owners may still be eligible for a loan forgiveness.
How do you apply for a loan waiver?
Small business owners can apply for forgiveness of PPP loans once all of the loan proceeds for which the borrower is applying for forgiveness have been used.
These borrowers can apply for forgiveness at any time up to the loan due date.
However, if a Borrower does not apply for Loan Forgiveness within 10 months of the last day of the Covered Period, payment of the PPP Loan cannot be deferred and Borrowers must begin making loan payments to their PPP Lender.
The following steps must be completed in order to apply for the PPP loan forgiveness program:
- Determine if your lender participates in direct SBA forgiveness;
- Make a list of your documentation;
- Submit the forgiveness form and documentation to the SBA or your PPP lender;
- Monitor your request for forgiveness.