How Would a Business Qualify for the New 2nd Draw PPP Loan?
Businesses hardest hit during the COVID-19 pandemic have been targeted for stimulus funds under the law. In fact, businesses can’t qualify for a PPP loan unless they were in operation by Feb. 15, 2020.
A second draw PPP loan is available to eligible businesses who have previously received an original PPP loan and meet certain requirements, which include:
Employing fewer than 300 people
Having used or will use all funds from their first PPP loan
Showing a reduction in gross receipts of 25 percent or more during any quarter in 2020 when compared to that same quarter in 2019.
How Do I Apply for a 2nd Draw PPP Loan?
For loans up to $150,000, businesses would need to submit a certification with their loan application attesting that the business meets the revenue loss requirements (25% or more reduction in gross receipts during any quarter in 2020 when compared to that same quarter in 2019).
However, they will be required to provide proof that on or before the time of applying for forgiveness that the business met the revenue loss standard.
How Much Can a Business Borrow Under the New PPP Loan?
For first-time PPP borrowers, the maximum amount is $10 million.
For 2nd Draw PPP, the maximum is $2 million.
For both first and second draw PPP loans, the maximum amount one can borrow generally is 2.5 times the average monthly payroll cost based on defined 12-month periods.
However, restaurants and businesses with NAICS codes (accommodations and food services) beginning with 72 are eligible for 2nd Draw loans with a maximum of 3.5 times the average monthly payroll cost.
Ready to Take the Next Step?
CardPlus® is willing to assist anyone who needs help with applications and applying for the 2nd Round PPP Loans.
For quick action call Ferne Glemby direct at 973-714-0807
or email her team at firstname.lastname@example.org.