Paycheck Protection Program (PPP) second draw loans opened to limited lenders Jan. 11 before opening to all lenders Jan. 19. The Small Business Association reported in the first two weeks of the program’s re-opening, SBA approved more than 400,000 loans.
RVDA reminded members about PPP’s relaunch in a posting on its website, but cautioned potential participants before accessing a second draw loan.
“Please note: Dealerships applying for a new PPP loan must certify that the loan is ‘necessary to support ongoing business operations in light of current economic conditions’” RVDA stated. “This parallels the certification dealerships made when applying for PPP loans in 2020. Dealers interested in applying for a new PPP loan should take the time to consult with legal counsel, accountants and prospective lenders.”
Businesses which received a PPP loan have similar terms and conditions for their second draw. Among the changes in eligibility is companies must have fewer than 300 employees, or fewer than 500 employees if they operate more than one location, to access a second draw. In addition, the company must be able to demonstrate a revenue reduction of 25 percent or more for any quarter of 2020 relative to the same quarter of 2019.
SBA stated the agency approved 60,000 loans totaling more than $5 billion in the first week of PPP’s renewal. As of Jan. 24, that increased to 400,580 loans totaling more than $35 billion.
“The SBA continues to help small businesses across the nation access vital funds through the Paycheck Protection Program,” SBA Administrator Jovita Carranza said. “Data from our first week, which first allowed hundreds of community financial institutions to submit applications, then opened wider to small banks, demonstrate that we have helped tens of thousands of businesses.
“The PPP is off to another great start helping our nation’s economy,” she said. “With PPP re-opening for all first and second draw loan applications, the SBA remains committed to keeping small business workers on payroll and their doors open during this challenging time. Moreover, the SBA over-performed operationally, issuing guidance and rules in advance and in alignment with the new law’s requirements.”
