5 Tips When Applying for the Paycheck Protection Program

A man with his hand over his head working in a grocery store wearing a mask and apron.

Are you the owner of a small business? Do you lead a non-profit?      

Have you heard or read nightmare stories about people having trouble getting a Paycheck Protection Program (PPP) loan?

What about business owners waiting for weeks for an answer regarding their application?

The stories of business owners not being able to get funding is heartbreaking.  

Yet, we’ve seen and read the stories of sports teams, large companies, and others getting a PPP loan:

  • The Los Angeles received $4.6 million.
  • Harvard University (who has a $40 billion endowment) received $8.6 million then returned the money.
  • Two hundred publicly traded companies have reported receiving more than $750 million in bailout loans, according to the New York Times. Some returned the money. Some did not.

The PPP initially provided $349 billion to prevent the economic collapse of small businesses. 

There are 30 million small businesses in the United States, so it was evident the first round of funding wasn’t enough money to help everyone.  

The first round of PPP funding ran out in just 14 days.

Congress provided more money, and $130 billion remains in the loan fund.

While PPP funds are still available, Congress will undoubtedly provide even more money in the program in the next COVID aid bill expected later this month.    

I’ve advised small businesses, non-profits, and local governments on how to get pandemic help from Congress, the Small Business Administration (SBA), and the Treasury Department. 

I’ve helped family members with unemployment claims and employment policies for their employees.

Seeing the frustration and problems that people encountered, here are five tips when applying for PPP funds (and other government aid):

  1. Apply for ALL available dollars – Sounds obvious, right? Well, it is not.

There is so much misinformation about government aid to deal with the COVID-19 pandemic. 

In addition to applying for the Payment Protection Program, apply for an Economic Injury Disaster Loans (EIDL), which are also emergency loans available to businesses.

Congress specifically said businesses could apply for both – it is not an either/or choice, as so many people have asked me. Go to www.sba.gov to check out all of the loan and grant programs available from the Small Business Administration.

  1. Submit All Documentation with Loan Application – When the pandemic started, there were news reports about the SBA website crashing due to overwhelming traffic.

 The site crashed because people were looking for information when none was available.

I explained to my clients and family members that they had the information they needed – documentation of lost sales and revenue decline from January to the present.   

Compile all of your documentation from January until the time you apply for the loan.

Provide ALL of this information with your application.

Submitting all information at one time will prevent unnecessary delays and back and forth communications.

  1. Relationship with a Bank – Over the past four to five months, all of us have read or heard or know someone who was very frustrated dealing with their bank.

I have one client who has a relationship with a large bank. They had no problems applying for EIDL and PPP loans.

However, I have a family member who had the exact opposite experience dealing with a local community bank in a rural area.

Press reports have signaled success or failure to get funds depends on whether you have a relationship with a bank.   

While your banking relationship is one factor, it is not the deciding factor.

Even if you have a relationship with a bank, you must continuously push for your loan application to be processed quickly.

  1. Persistence, Even Annoyance – Call. Email. Visit the bank. Repeat every single day.

My family member who applied for the PPP – called, sent persistent emails, and constantly visited the bank asking about the status of the loan for four weeks.

After four weeks and continuously pushing for his loan to be processed, he finally received notification that his loan application was approved.

You have to be persistent, or else your application will get lost or delayed.

AND if the bank won’t respond, call your Congressman/Congresswoman and Senator to demand help. 

  • Enter your zip code to find your Representative at house.gov.
  • Find your Senators at senate.gov, or
  • Call the Capitol Switchboard at 202-224-2131 to ask to speak to your Representative or Senator.  

      Make your voice heard.

  1. Document – Once my clients and family received their loans, I advised each of them to document, document, document – make sure you have a record for every single penny.

Remember, you are dealing with the Federal Government.

If your documentation shows the loan complies with the criteria, the loan will be considered a grant. It will be forgiven. 

If not, the loan must be repaid over the next two years.

These are the original rules established in April. Keep in mind that Congress started making changes to the program in May and June.

The deadline has changed.

The 75/25 payroll rule has changed.  

And let’s be honest, with all of these changes, you need documentation to show you made a good faith effort to comply with the terms of the program as the terms of this program continue to evolve.

These tips will help, but here’s the bottom line: Don’t give up. The money is available.

You have paid into a system that now owes you the money you’ve earned and deserve. 

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