SBA, Treasury release additional PPP FAQs

Federal Issues Agency Rule-Making & Guidance Department of Treasury SBA CARES Act Small Business Lending Covid-19 E-Signature

On April 15 and 14, the Small Business Administration (SBA) and the Treasury Department (Treasury) provided additional guidance to the Paycheck Protection Program (PPP) frequently asked questions (FAQs) to address lender concerns about, among other things, application submissions, signature requirements, and applications from SBA employees and family. Some of the FAQs include the following guidance:

• Lenders may submit loan applications through E-Tran only after collecting the same borrower information and certifications contained in the application form, and performing a good faith review of the borrower’s payroll calculations.
• Lenders that submitted applications prior to April 14 without collecting the required borrower information and certifications must do so as soon as possible before loan closing.
• Lenders may accept scanned copies of loan applications, borrower certifications, and other required documents. E-sign compliant electronic signatures and consents may also be accepted.

On April 13, one of the SBA and Treasury FAQs—also included on FinCEN’s website along with FAQ 18—discusses beneficial ownership requirements for PPP loans. For new customers, lenders meet their beneficial ownership obligations by collecting the following information from natural persons with ownership stakes in the applicant of 20 percent or greater: “owner name, title, ownership %, TIN, address, and date of birth.” SBA and Treasury also released an FAQ that addressed lender submission requirements prior to issuing PPP loans. FAQ 21 states that lenders are required to sign the lender application form for the PPP (SBA Form 2484) in order to issue PPP loans, but lenders do not need a separate SBA Authorization. Terms and conditions in the lenders’ promissory note must be consistent with CARES Act sections 1102 and 1106 as well as the PPP Interim Final Rule. Additional FAQs from this date address nonbank lenders, the $10 million loan cap, and the affiliation rules applicability to various kinds of businesses.

Please see Buckley’s dedicated SBA page, which includes additional SBA resources.