If you’re wondering when your PPP loan payments will start, the answer depends on a few factors. Read on to learn more about when you can expect to receive your PPP loan funds.
Checkout this video:
Under the CARES Act, small business owners can apply for a Paycheck Protection Program (PPP) loan to help cover the cost of employee salaries and other operating expenses. The PPP loan is designed to help small businesses keep their employees on the payroll during the COVID-19 pandemic.
The PPP loan is a forgivable loan, which means that if you use it for its intended purpose (i.e., to keep your employees on the payroll), you will not have to repay the loan.
So, when do PPP loan payments start? The answer is that there is no set date for when PPP loan payments start. You will have up to 10 years to repay the loan, but you may choose to make payments on the loan sooner than that. If you use the loan for its intended purpose (i.e., to keep your employees on the payroll), then the entire loan will be forgiven and you will not have to make any payments on the loan.
What is a PPP Loan?
A PPP loan is a loan provided by the Small Business Administration (SBA) to help small businesses and self-employed individuals keep their employees on the payroll during the coronavirus pandemic.
The Paycheck Protection Program (PPP) loans are 100% federally guaranteed, meaning that if you’re unable to make your loan payments, the SBA will cover the outstanding balance. These loans are available through June 30, 2020.
To qualify for a PPP loan, your business must have less than 500 employees. If you’re self-employed, you can also apply for a PPP loan.
If you’re approved for a PPP loan, you can use the funds to cover your payroll and other eligible expenses, such as rent, utilities and mortgage interest. You can also use the funds to pay for personal protective equipment (PPE) for your employees.
Once you’ve received your PPP loan, you have eight weeks to use the funds. If you use the funds for eligible expenses and maintain your employee headcount, then your loan will be forgiven.
How Do PPP Loans Work?
The PPP loan program is designed to provide small businesses with the capital they need to keep their doors open and their employees on the payroll during the COVID-19 pandemic.
Under the program, small businesses can apply for loans of up to $10 million. The loans are 100% federally guaranteed and can be used to cover payroll and other operating expenses.
Loans are available for up to 10 weeks of expenses, and terms can be up to 10 years. Interest rates on the loans are capped at 4%.
Loan payments are deferred for six months, but borrowers can choose to make interest-only payments during that time. After the six-month deferral period, loan payments will be based on the terms of the loan.
When Do PPP Loan Payments Start?
The PPP loan program provides small businesses with funds to cover 2.5 months of payroll and other expenses. The loans are available through June 30, 2020.
ppp loan payments start when the business applies for the loan. The business will need to provide payroll documentation to the lender, and the lender will use that information to calculate the loan amount. Thebusiness can then choose to have the loan payments deferred for six months or make interest-only payments during that time.
What Happens if I Can’t repay My PPP Loan?
If you are unable to repay your PPP loan in full by the maturity date, you will have to begin making payments on the remaining balance. The amount of each payment will be determined by your loan agreement with your lender.
If you are unable to make payments on your PPP loan, you may be eligible for deferment or forbearance. Deferment means that you can postpone making payments on your loan for a period of time. Forbearance means that you can temporarily stop making payments on your loan or reduce the amount of each payment.
If you are able to resume making payments on your loan, you should contact your lender as soon as possible to arrange a repayment schedule. If you are having difficulty finding a lender who is willing to work with you, you may be able to get help from the Small Business Administration (SBA).
In conclusion, PPP loan payments will start when the borrower submits their first loan forgiveness application. If the borrower does not apply for forgiveness, then they will begin making payments on their loan after 10 months.