Paycheck Protection Program Enhancements:

In March of 2020, the enactment of the CARES Act created the Paycheck Protection Program (PPP). These small business loans can be up to 100% forgiven if used for designated expenses.

The passage of the Consolidated Appropriations Act of December 27, 2020, extends to March 31, 2021, the deadline for borrowers to apply for assistance under both Round One of PPP and the Second Draw of PPP. (Please note SomerCor is NOT a PPP lender)

PPP – Round One

Round One PPP Loans can be used to help fund payroll costs (including benefits), mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.

  • PPP loans have an interest rate of 1%.
  • Loans issued prior to June 5, 2020 have a maturity of two years. Loans issued after June 5, 2020 have a maturity of five years.
  • Loan payments will be deferred for borrowers who apply for loan forgiveness until SBA remits the borrower’s loan forgiveness amount to the lender. If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
  • No collateral or personal guarantees are required.
  • Neither the government nor lenders will charge small businesses any fees.

To apply, reach out to your business banker or find a lender via SBA Lender Match. You can also save time by filling out the PPP Borrower Application Form.

PPP – Second Draw

PPP now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan with the same general loan terms as their First Draw PPP Loan.

Second Draw PPP Loans can be used to help fund payroll costs (including benefits), mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector (use NAICS 72 to confirm), the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020

To apply, reach out to your business banker or find a lender via SBA Lender Match. You can also save time by filling out the PPP Borrower Application Form.

SBA Contact Information for Additional Questions:

SBA Paycheck Protection Program Website
Illinois District Office: (312) 353-4528 | Illinois.DO@sba.gov | Twitter: @SBA_Illinois