How to Apply for New PPP Loans as of January 14, 2021

Greenbox Capital > How to Apply for New PPP Loans as of January 14, 2021
Greenbox Capital > How to Apply for New PPP Loans as of January 14, 2021

How to Apply for New PPP Loans in 2021

Details on PPP Funding under CRRSAA as of January 14, 2021

Signed into law on December 27, 2020, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (CRRSAA) includes $284B in new PPP funding for small businesses impacted by the ongoing COVID-19 pandemic. The CRRSAA revises key aspects of the CARES act to provide more flexibility to small businesses, including a new round of PPP funding.

Last updated: January 14, 2021

Businesses are now eligible to receive up to two PPP loans. If you received a PPP loan in 2020, you are eligible to apply for a “second draw loan” under CRRSAA. If you did not receive a PPP loan in 2020, you are also eligible to apply.

Eligibility requirements have changed significantly in the second round of funding. In order to receive funding in the new round of PPP, businesses must meet the following criteria:

  • Revenue: Gross receipts must have declined by 25% or more in any quarter of 2020 compared to the same quarter in 2019. Previously, businesses were simply required to state that economic uncertainty made a PPP loan necessary.
  • Business size: The business must have fewer than 300 employees. Previously, businesses were permitted to have up to 500 employees.
  • Business age: The business must have been operating prior to February 15, 2020.
  • Previous funding: The business must have used, or will use, all of its previous PPP funding.

Qualified businesses include corporations, LLCs, sole proprietors, self-employed individuals, and independent contractors.

Funding has been set aside for the smallest businesses (under 10 employees), those in low- and moderate-income areas, as well as for small community banks, credit unions, and community-based lenders to help level the playing field for smaller businesses with greater needs.

Here’s what hasn’t changed:

  • Funding amount: Funding is still limited to a maximum of $2M per business and businesses can still access up to their average monthly payroll in 2019 x 2.5.
  • Forgiveness: Loans will continue to be forgiven if at least 60% of proceeds are spent on payroll expenses, with a maximum of 40% spent on other qualifying expenses during an 8 or 24 week period. However, more expenses are now eligible for forgiveness.
  • Period of use: Loan proceeds can be used over a 24 week period.

How to apply for PPP forgiveness

More non-payroll expenses are now eligible for forgiveness, including:

[iconlist icon_fontawesome=”” icon_size=”mini”][iconlist_item icon_fontawesome=”fas fa-check”]Operations expenditures[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Property damage costs[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Supplier costs[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Worker protection expenditure[/iconlist_item][/iconlist]

If your PPP loan was for $150,000 or less, there is now a new one-page form (supplied by your lender) to apply for forgiveness. Under the original CARES Act, this one-page form was only available to businesses who received loans for $50,000 or less.

Businesses must apply for loan forgiveness through the lender that provided the loan, with documentation showing that the funds were used appropriately. Your lender has 60 days to review and approve your forgiveness application before submitting the application to the SBA. The SBA then has 90 days to approve your application or request more information.

Program Details on SBA.gov

Changes to EIDL and tax relief

This program provides small businesses with working capital loans of up to $2 million that can help provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

The CRRSAA also includes changes to the EIDL program, as well as tax relief measures for businesses impacted by the COVID-19 pandemic.

Disaster Loan Assistance on SBA.gov

What if you don’t get approved for PPP funding?

If you apply for and do not receive PPP funding in 2021, there are a number of other funding options available for small businesses, including alternative lenders like Greenbox Capital®. Alternative funding offers a number of advantages for businesses impacted by COVID-19, including:

[iconlist icon_fontawesome=”” icon_size=”mini”][iconlist_item icon_fontawesome=”fas fa-check”]Easier qualification criteria[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Faster review and approvals[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]A variety of funding options are available to suit your business’s needs, including merchant cash advances, invoice factoring, collateral loans, and business lines of credit[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Businesses in high-risk industries can also receive funding[/iconlist_item][iconlist_item icon_fontawesome=”fas fa-check”]Businesses with low credit can receive funding[/iconlist_item][/iconlist]

Apply for Alternative Funding

Sources
  1. “Everything You Need to Know About Coronavirus Federal Small Business Stimulus Aid Programs.” Sean Ludwig. U.S. Chamber of Commerce. Last updated Dec. 28, 2020.
  2. “What Small Business Owners Need To Know About The New Stimulus Package.” Brian Thompson. Forbes. Dec. 21, 2020.
  3. “New Relief Package Provides Next Round of PPP Funding for Small Businesses.” Neil Hare. Forbes. Dec. 21, 2020.
  4. “New Stimulus Bill Includes Second Round of PPP Loans for Small Businesses and Forgiveness Rule Changes Favorable to Borrowers.” Mat Sorenson. Entrepreneur. Dec. 22, 2020.
  5. “What’s in the stimulus package for small businesses, PPP loans and cultural grants.” Rhonda Abrams. USA Today. Dec. 30, 2020.

Government Funding Programs in Canada

The types of loans offered for businesses are:

  1. CEBA (Canada Emergency Business Account)
  2. CEWS 75% (Canada Emergency Wage Subsidy)
  3. CEWS 10% (Canada Emergency Wage Subsidy)

Learn More Here

Additional Resources

Small Business Relief Programs by State

Suggested Reading

U.S. Chamber of Commerce: Business Owner Tips

U.S. Chamber of Commerce: Coronavirus Business Guide

11 Tips for Managing Anxiety During Coronavirus

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Greenbox Capital stands united with our customers during this pandemic crisis and economic slowdown.
We will provide payment assistance to all customers showing a loss of revenue.
Please contact us at 305.952.3200, select option 1 to discuss payment assistance.

Other Funding Options

To explore other funding options through Greenbox Capital, call one of our knowledgeable Funding Advisors at 855.442.3423 or click the Apply Now button.