As of January 11th, 2021, the U.S. Small Business Administration (SBA) and the U.S. Treasury Department announced that the Paycheck Protection Program (PPP) will be reopened for new borrowers and for certain existing PPP borrowers.

Starting January 11th, community financial institutions will be able to make First Draw PPP loans. Then starting on January 13th, community financial institutions will be able to make Second Draw PPP loans. Shortly after January 13th PPP loans will be open to all participating lenders.

These PPP loans are continuing to prioritize the millions of American small businesses that need help through these trying times. Up to $284 billion has been authorized to be used towards job retention and certain other expenses small businesses have through March 31st, 2021. Existing PPP borrowers may apply for a Second Draw PPP loan as well.

There have been some key updates made to the PPP loans including:

• PPP borrowers can change the loans’ coverage period from between 8 to 24 weeks to better meet their business needs.
• PPP loans may be used to cover additional expenses, like operations expenditures, property damage, supplier costs, and worker protection expenditures.
• The Program’s eligibility now includes 501©(6)s, housing cooperatives, destination marketing organizations, and other types of organizations.
• More flexibility for seasonal employees.
• Existing PPP borrowers can request to modify their First Draw PPP Loan amount.
• Certain existing PPP borrowers may be eligible to apply for a Second Draw PPP Loan.

An existing PPP borrower is generally eligible for a Second Draw PPP Loan if they meet these 3 requirements:

1. Has previously received a First Draw PPP Loan and has or will use the full amount
2. Has no more than 300 employees
3. Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

Treasury Secretary Steven Mnuchin said, “The Paycheck Protection Program has successfully provided 5.2 million loans worth $525 billion to America’s small businesses, supporting more than 51 million jobs. This updated guidance enhances the PPP’s targeted relief to small businesses most impacted by COVID-19. We are committed to implementing this round of PPP quickly to continue supporting American small businesses and their workers.”

Ready to apply? Click HERE for the PPP Loan application.

Have questions or need more information on PPP loans? Check out SBA’s website for more information on the Paycheck Protection Program.