ONLINE APPLICATION PORTAL - IMPORTANT DETAILS
• Our online application portal will be powered by Lendio.com. It's possible that a Lendio representative will contact you to help complete your application accurately, or to help you add missing documentation.
• Upon application completion, Lendio will email you an application confirmation and will also provide email updates during the process.
• After the application is complete and approved within the Lendio system, it must then be entered into the SBA submission portal (E-tran) for final SBA authorization.
• Due to the unprecedented size of the PPP program, combined with the speed and efforts of the government's rollout, the SBA submission portal (E-Tran) is experiencing intermittent downtime. Lenders across the United States are reporting much longer processing times than normal. If this system is down, you may receive an update from Lendio. You can also view updates on this page.
• During times that the SBA submission portal (E-tran) is down, applications cannot be completed. The SBA must approve all applications before funding from your financial institution is possible.
ONCE I HAVE RECEIVED MY SBA PPP LOAN WHAT DO I NEED TO BE ELIGIBLE FOR SBA LOAN FORGIVENESS?
If you received funding through MSUFCU for your SBA PPP loan you may be eligible for SBA loan forgiveness but you have to follow the applicable SBA guidance. Click here
to review the SBA guidance or your loan may not be forgiven.
The SBA has stated that loan forgiveness will depend, in part, on the total amount of payroll costs, payments of interest on mortgage obligations incurred before February 15, 2020, rent payments on leases dated before February 15, 2020, and utility payments under service agreements dated before February 15, 2020, over the eight-week period following the date of the loan. However, not more than 25 percent of the loan forgiveness amount may be attributable to non-payroll costs. The SBA has also stated that they will provide additional guidance. Until additional guidance is provided, please consider the following that may help you be eligible for SBA loan forgiveness:
• Eligible expenditures should be tracked over the eight-week period (Covered Period) following the date of the loan.
•You must document all SBA PPP loan eligible expenditures.
•Payroll costs may be supported by applicable IRS forms, other unemployment insurance tax reporting forms, or equivalent payroll processor records that correspond to the covered period.
• Non-payroll costs may be supported by cancelled checks, payment receipts, transcripts of accounts, or other documents verifying payments on covered obligations that correspond to the covered period.
• You must maintain employee and compensation levels.
• You must comply with all certifications that you made on your SBA application. click here
to review the SBA application.
• You should consult with your CPA or attorney for SBA loan forgiveness eligibility.
• You must request SBA loan forgiveness within SBA timelines through MSUFCU once eligible expenditures have been made and documented.
• MSUFCU will make available the SBA loan forgiveness application once SBA releases guidance and the application for forgiveness.
• SBA requires that MSUFCU make a decision on your SBA loan forgiveness application within 60 days of receipt of your application.
If your SBA PPP loan is not forgiven your loan payments will begin 6 months after the date of your loan disbursement.
*The statements and suggestions provided in this FAQ document are not legal opinions and cannot be relied upon as legal or financial advice. You should consult with your own legal counsel and/or financial advisor for guidance on use of loaned funds and requirements for forgiveness of the loan obligation. MSUFCU will only forgive as much of the loaned amount as the federal government pays to MSUFCU pursuant to the loan forgiveness application. Any unforgiven amount of the loaned funds will be your obligation to repay to MSUFCU according to the terms of the note and other loan documents.
I ALREADY SUBMITTED MY APPLICATION TO MSUFCU DIRECTLY, NOW WHAT?
Due to the extremely high application volume for the SBA PPP (Paycheck Protection Program) loan, MSUFCU needed to pivot and determine a more efficient and streamlined way to accept applications for this program. If you submitted your materials to us directly via eMessage or email prior to the portal being available to members, you will receive an email with the application link to submit your application and supporting documentation again via the portal. We apologize for the inconvenience this may have caused, however this was essential to allow us to fund your loan in a timely manner.
CAN I GET MY SBA PPP LOAN WITH MSUFCU?
If your business account is with another bank or credit union, you will need to contact that financial institution to apply for your SBA PPP (Paycheck Protection Program) loan. Due to the extremely high volume of applications, we made the difficult decision to only offer this to our established business members with active accounts as of February 15, 2020. Thank you for your understanding.
WHO IS ELIGIBLE FOR A PPP LOAN?
Eligible borrowers must have 500 or fewer employees whose principal place of residence is in the United States, or are a business that operates in a certain industry and meets the applicable SBA employee-based size standards for that industry and the following criteria:
•A small business concern as defined in section 3 of the Small Business Act, and subject to SBA's affiliation rules under 13 CFR 121.301(f) unless specifically waived in the Act
• A tax-exempt nonprofit organization described in section 501(c)(3) of the Internal Revenue Code (IRC), a tax-exempt veterans organization described in section 501(c)(19) of the IRC, Tribal business concern described in section 31(b)(2)(C) of the Small Business Act, or any other business; and
• You were in operation on February 15, 2020 and either had employees for whom you paid salaries and payroll taxes or paid independent contractors, as reported on a Form 1099-MISC.
• Eligible borrowers also include an individual who operates under a sole proprietorship or as an independent contractor or eligible self-employed individual if you were in operation on February 15, 2020.
• Nonprofit organizations specifically authorized under the CARES Act are eligible.
Eligible borrowers may not receive more than one PPP loan, a borrower should consider applying for the maximum amount.
WHAT IS THE MAXIMUM PPP LOAN AMOUNT?
A small business is eligible to borrow the lesser of $10 million or an amount that is calculated using a formula in the CARES Act, which is basically up to 2.5 times their average monthly payroll costs from the previous year. Payroll costs consist of compensation to employees in the form of salary, wages, commissions, or similar compensation; payment for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payment for the provision of employee benefits consisting of group health care coverage, payment of state and local taxes assessed on compensation of employees, and certain other costs. The CARES Act outlines exclusions to the calculation of payroll costs.
For example, the following methodology will assist most applicants in determining the maximum PPP loan amount:
• Example 1 - No employees make more than $100,000 Annual payroll: $120,000 Average monthly payroll: $10,000 Multiply by 2.5 = $25,000 Maximum loan amount is $25,000
• Example 2 - Some employees make more than $100,000 Annual payroll: $1,500,000 Subtract compensation amounts in excess of an annual salary of $100,000: $1,200,000 Average monthly qualifying payroll: $100,000 Multiply by 2.5 = $250,000n Maximum loan amount is $250,000
Independent contractors do not count for purposes of a borrower's PPP loan calculation as they have the ability to apply for a PPP loan on their own.
HOW CAN PPP LOANS BE USED?
• Payroll costs (as defined in the Act and above)
• Costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums
• Mortgage interest payments (but not mortgage prepayments or principal payments)
• Rent payments
• Utility payments
• Interest payments on any other debt obligations that were incurred before February 15, 2020; and/or
• Refinancing an SBA Economic Injury Disaster Loan (EIDL) made between January 31, 2020 and April 3, 2020 with certain conditions. If the EIDL loan was not used for payroll costs, it does not affect the eligibility for a PPP loan. If the EIDL loan was used for payroll costs, the PPP loan must be used to refinance the EIDL loan.
WHAT IS THE INTEREST RATE, FEE AND MATURITY ON A PPP LOAN?
• The interest rate will be 100 basis points or one percent.
• The maturity is two years.
• No fees will be charged.
WHEN MUST REPAYMENT OF PRINCIPAL AND INTEREST BEGIN?
Payments do not need to be made for six months following the date of disbursement of the loan. However, interest will continue to accrue on PPP loans during this six-month deferment.
CAN THE PPP LOAN BE FORGIVEN?
Any portion of the loan used to make payroll, pay for utilities, rent, mortgage, and existing business debt may be forgiven, dollar for dollar if workers remain employed through the end of June. The amount of loan forgiveness can be up to the full principal amount of the loan and any accrued interest. The actual amount of loan forgiveness will depend, in part, on the total amount of payroll costs, payments of interest on mortgage obligations incurred before February 15, 2020, rent payments on leases dated before February 15, 2020, and utility payments under service agreements dated before February 15, 2020, over the eight-week period following the date of the loan. However, not more than 25 percent of the loan forgiveness amount may be attributable to non-payroll costs.
WHAT FORMS ARE REQUIRED FOR BORROWER AND LENDER?
Borrowers must submit SBA Form 2483 (Paycheck Protection Program Application Form) and required payroll documentation as outlined in the interim final rule. Lenders must submit SBA Form 2484 (Paycheck Protection Program Lender's Application for 7(a) Loan Guaranty) electronically in accordance with program requirements and maintain the forms and supporting documentation in its files.
WHAT ARE REQUIRED CERTIFICATIONS FOR A PPP LOAN?
On the Paycheck Protection Program Application SBA Form 2483, an authorized representative of the applicant must certify in good faith to the timeframe during which the applicant was in operation and paying employee salaries, the necessity for the loan request to continue operations in the current economic situation, funds will be used to retain employees and pay salaries and other approved costs, and provide required documentation to verify stated costs.
WHAT ARE THE LOAN TERMS AND CONDITIONS?
In addition to the terms and conditions of other 7(a) loans, the PPP loans will be guaranteed with certain changes including but not limited to:
• The guarantee percentage is 100 percent.
• No collateral or personal guarantee will be required.
• The interest rate will be 100 basis points or one percent.
• All loans will be processed by all lenders under delegated authority and lenders will be permitted to rely on certifications of the borrower in order to determine eligibility of the borrower and the use of loan proceeds.
• There will be no up-front guarantee fee payable to SBA by the borrower.
• SBA may provide further guidance, if needed, through SBA notices and a program guide which will be posted on SBA's website
• Questions on the Paycheck Protection Program 7(a) Loans may be directed to the Lender Relations Specialist in the local SBA Field Office
• For additional information on who is eligible to borrow, see the Treasury's information for borrowers