When can borrowers apply for PPP loan forgiveness?
TEMPORARY NOTICE: Business owners who have received a PPP loan prior to February 28th will be able to apply for forgiveness on those loans on or about May 24th. For loans funded after February 28th, more information will be announced at that time. Check your Biz2Credit dashboard for the latest information on your loan.
Borrowers should apply for PPP loan forgiveness at the end of the covered period. Covered periods may range from 8 to 24 weeks, with the exact term determined by the borrower during the PPP loan application process.
Please note, SBA grants borrowers a deferral period of up to 10 months starting at the end of the covered period. If by the end of the deferral period the borrower has not applied for forgiveness, or the full amount of the loan was not forgiven, then the borrower will need to repay any remaining balance on the loan.
The Economic Aid Act (enacted into law on December 27, 2020) provides that a Second Draw PPP Loan may only be made to an eligible borrower that (i) has received a First Draw PPP Loan, and (ii) has used, or will use, the full amount of the First Draw PPP Loan on or before the expected date on which the Second Draw PPP Loan is disbursed to the borrower.
This means your business must use all PPP funds from your First Draw loan before you can take funding from a Second Draw loan. Businesses must apply for their First Draw forgiveness before they apply for forgiveness for their Second Draw loan.