The U.S. Small Business Administration released additional guidance on the Paycheck Protection Program (PPP) last night, making significant modifications to the loan calculation and terms for businesses seeking relief from COVID-19 losses.
The major changes include:
- Independent contractor payments will not be included in payroll costs when calculating the size of a business’s PPP loan.
- Interest rates on PPP loans will be 1.0%. (Interest will not be applied if a business qualifies for loan forgiveness under the PPP.)
- A new PPP application form was released and replaces the form issued by the SBA earlier this week.
Some banks have indicated that they will not be ready to begin accepting applications until Monday. Grassi’s Emergency Loan Consulting team is monitoring these developments closely and will keep you updated as more guidance is issued.