By SEMA Washington, D.C., Staff
The Small Business Administration (SBA) will now allow borrowers with Paycheck Protection Program (PPP) loans of $150,000 or less to apply for forgiveness directly through the SBA. The SBA portal is designed to streamline the process and remove pressure from small lenders to handle forgiveness applications as the SBA looks to wind down the PPP loan program.
Banks responsible for originating the PPP loans must opt into direct forgiveness before their borrowers can use the SBA’s online platform. Currently, more than 500 banks have opted in and allowed their borrowers to apply for forgiveness through the SBA portal, which began accepting applications on August 4.
The deadline for seeking PPP loans ended May 31, but recipients are now seeking loan forgiveness for funds used to cover payroll, mortgage interest, rent, utilities and other costs. Loans are fully forgivable if at least 60% of loan proceeds are used on payroll costs (i.e., wages, payroll taxes, paid leave, healthcare payments, retirement and insurance contributions).
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