Best Practices: Underwriting the PPP Loan to a “Forgiveness Standard.”
The Paycheck Protection Program (“PPP”) has been a challenge for many SBA lenders, both in terms of the speed with which it has necessarily been implemented as well as the significant changes in its requirements from standard SBA 7(a) loans. SBA Lenders have been processing PPP guidance that has been changing on a daily, and ... Read More
Best Practices: Paycheck Protection Program Loan Forgiveness: What We Know, What We Need To Find Out
Now that the first wave of Paycheck Protection Program (“PPP”) loans have been approved and are being funded, Lenders’ and Borrowers’ attention have turned to Section 1106 of the CARES Act (Pub.L. 116-136), Loan Forgiveness. According to the statute, Borrowers will be eligible for forgiveness of indebtedness on a PPP loan in an amount equal ... Read More
Best Practices: Who is an Authorized Representative under the Paycheck Protection Program?
While the CARES Act, the First PPP Interim Final Rule and guidance issued by the U.S. Treasury and U.S. Small Business Administration repeatedly state that lenders may rely on representations made by the borrower’s authorized representative, this term is not defined in the enabling legislation, implementing rules and regulations, or formal written guidance. Particularly troubling ... Read More
Best Practices: Six Month Loan Payment Subsidy under the CARES Act
On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was passed into law. This legislation provides various forms of government aid to small businesses adversely impacted by the Coronavirus Disease 2019 (“COVID-19”) and the COVID-19 Emergency Declaration issued by President Trump on March 13, 2020. Under Section 1112 of ... Read More
Best Practices: Paycheck Protection Program
On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), providing small businesses and individual entrepreneurs with various forms of government aid. Key among the proposed measures is the Paycheck Protection Program included in Section 1102 of the CARES Act. While the U.S. Small Business Administration ... Read More
Updated Regular 7(A) Guaranty Purchase Tabs
The rapidly evolving environment precipitated by the coronavirus will have a wide reaching adverse economic impact on many American small businesses, as more and more business are forced to close to comply with government declarations. Unfortunately, many are likely to suffer an adverse economic impact from the current crisis, and if the business was already ... Read More