The SBA has issued its “Interim Final Rule” for lenders to follow when issuing the Paycheck Protection Program.
Highlights of final lending guidance:
- Loans will be 100% guaranteed to lenders by the SBA
- No collateral will be required.
- No personal guarantees will be required.
- Lender does not need to conduct any verification if the borrower submits documentation supporting its request for loan forgiveness. SBA holds lenders harmless.
- If loan proceeds exceed forgiveness amount, loan is for 24 months from issue at 1% interest.
What is needed for underwriting:
- Confirm receipt of borrow certifications with PPP Application Form from SBA
- Confirm borrower had employees for whom the borrower paid salaries and payroll taxes on or around Feb 15, 2020.
- Confirm the dollar amount of average monthly payroll costs for the preceding calendar year by review payroll documentation.