- SBA PPP Loan Basics
- The Application Process
- The Underwriting Process
- The Funding Process
If you’re wondering how long it will take for the SBA to approve your PPP loan, you’re not alone. Many small business owners are eager to get their hands on the funding they need to keep their businesses afloat, and the approval process can seem like a mystery.
Fortunately, we’ve got some insider information on the subject. Here’s a quick overview of the SBA’s PPP loan approval process and what you can expect.
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SBA PPP Loan Basics
The SBA Paycheck Protection Program (PPP) loan is a forgivable loan designed to help small businesses keep their workers employed during the coronavirus (COVID-19) pandemic.
What is an SBA PPP loan?
The Paycheck Protection Program (PPP) is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.
SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.
How long does it take to get approved for an SBA PPP loan?
The answer to this question depends on a few factors, including the size of your loan, the lender you are working with, and how prepared you are with your paperwork.
In general, it can take anywhere from a few days to a few weeks to get approved for an SBA PPP loan. The Small Business Administration (SBA) is responsible for approving all PPP loan applications, and they have stated that they will prioritize applications from small businesses and sole proprietorships.
Larger businesses may have a more difficult time getting approved for an SBA PPP loan, as the SBA will be focusing on approving loans for businesses that have less than 500 employees. If you are a larger business, you may want to consider applying for a traditional bank loan instead of an SBA PPP loan.
It is also important to note that some lenders may take longer to approve your loan than others. For example, banks that are not participating in the PPP program may take longer to process your application. You should check with your lender to find out how long they expect it will take to get approved for an SBA PPP loan.
To increase your chances of getting approved for an SBA PPP loan, it is important to gather all the required paperwork before you apply. This includes your tax returns, payroll reports, and other financial documents. You can find a complete list of required documentation on the SBA website.
If you are prepared with all of your documentation, you can expect to get approved for an SBA PPP loan in a matter of days or weeks. However, if you are not prepared with the required paperwork, it could take longer to get approved for a loan.
The Application Process
How to apply for an SBA PPP loan
The SBA’s Paycheck Protection Program (PPP) is a loan designed to help small businesses keep their workers on the payroll during the COVID-19 pandemic.
The PPP loan program is administered by SBA-approved lenders, and applications are submitted through those lenders. The SBA does not accept PPP loan applications directly from borrowers.
Borrowers can find a list of SBA-approved lenders on the SBA’s website.
The application process for a PPP loan is generally completed online through the lender’s website. Borrowers will need to provide some basic information about their business, such as their business name, contact information, tax identification number, and the number of employees they have.
Borrowers will also need to provide some financial information, such as their annual revenue and the amount of money they would like to borrow.
Once a borrower has submitted their application, it will be reviewed by the lender. If the lender approves the application, they will send it to the SBA for final approval.
The SBA has said that it aims to approve or deny all PPP loan applications within 10 days of receiving them from lenders. However, some borrowers have reported that it has taken longer than 10 days for their applications to be approved or denied.
What documents do you need to apply for an SBA PPP loan?
You will need the following documents to apply for an SBA PPP loan:
-Your most recent tax return
-Your most recent business bank statements
-Your most recent personal bank statements
-A list of all of your current creditors
-Your driver’s license or other government-issued ID
You may also need to provide additional documentation, depending on your business type. For example, if you are a sole proprietor, you will need to provide your most recent personal tax return. If you are a partnership, you will need to provide your Partnership Agreement.
The Underwriting Process
After you submit your PPP loan application, the SBA will begin their underwriting process. The SBA will go through your application and supporting documentation to verify the information you provided. They will also check to see if you are eligible for the PPP loan. The underwriting process can take a few days to a week.
What is the underwriting process for an SBA PPP loan?
The SBA’s Paycheck Protection Program (PPP) loan is a forgivable loan available to small businesses and non-profit organizations that have been impacted by the COVID-19 pandemic. The loan can be used to cover payroll expenses, rent, utilities, and other operating expenses.
In order to be eligible for a PPP loan, businesses must have fewer than 500 employees. Businesses with 500 or more employees may still be eligible if they meet certain size standards set by the Small Business Administration.
To apply for a PPP loan, businesses must complete an application and submit it to an SBA-approved lender. Once the application is received, the lender will review it to ensure that the business meets the eligibility requirements.
If the business is eligible, the lender will then send the application to the SBA for approval. The SBA will review the application and supporting documentation to determine whether the business qualifies for a PPP loan.
The entire process from start to finish can take several weeks. Once an application is approved, businesses will receive funding within 10 days if they choose to accept the loan terms and conditions.
How long does the underwriting process take?
The underwriting process is the process a lender or other financial institution uses to assess whether to approve a loan and what loan terms to offer. The process can take anywhere from a few days to a few weeks, depending on the type of loan and the lender.
For government-backed loans like those guaranteed by the Small Business Administration (SBA), the underwriting process can take longer due to the added level of review and documentation required. However, the SBA has streamlined its processes in recent years, and it is now possible to get approved for an SBA-backed loan in as little as two weeks.
The best way to ensure a quick and smooth underwriting process is to work with an experienced lender who is familiar with SBA guidelines and can provide all the necessary documentation upfront.
The Funding Process
The Small Business Administration (SBA) has been working hard to get Paycheck Protection Program (PPP) loans into the hands of small business owners as quickly as possible.
How long does it take to get funded?
The answer to this question is, unfortunately, not as straightforward as we would like it to be. While the SBA has been quick to process and approve most Paycheck Protection Program loan applications, each individual lender has their own timeline for approving and funding loans.
This means that even if your SBA loan application is approved quickly, you may still have to wait a bit longer to receive your funds. Typically, once your loan application is approved by the SBA, it will be up to your lender to fund your loan.
Most lenders are working hard to get funds disbursed as quickly as possible, but some larger banks and financial institutions are taking longer than others. If you are concerned about how long it may take to receive your PPP loan funds, we recommend reaching out to your lender directly for more information.
What happens if my loan is not approved?
If your loan is not approved, you will receive a letter from the SBA explaining why your loan was not approved and what, if any, additional information or documentation you can provide to have your loan approved.