The webinar gives a brief overview of the forgiveness requirements and also answers questions submitted from actual small business owners, among other items. The webinar features BBVA President and CEO Javier Rodriguez Soler, Chief Operating Officer Rafael Bustillo, Small- to Medium- Enterprises Network Executive Elizabeth Dobers and a handful of PPP loan forgiveness experts.
People think they need to start making their first payments
“The webinar walks small business owners through the entire process and is an invaluable resource, because we know there’s still a lot of confusion right now,” said Dobers. “People think they need to start making their first payments in October because there was a deferral period in the beginning, which was about six months.”
While the bank has not yet begun accepting forgiveness applications, Dobers does offer good news. For those who anticipate making their first payment soon because they haven’t yet undergone the forgiveness process, they may find they have more time to apply.
“The deferral period has been extended by the government,” she said. “There’s just a lot of uncertainty and a lot of questions from these small businesses, and it seems that this bit of news was unclear for them.”
In addition, legislation has been introduced that may simplify the forgiveness process for loans up to $150,000. While Dobers clarified that she cannot speculate on whether this legislation may pass, she did say that if it is passed, the bank would communicate the new process as soon as possible thereafter in its forthcoming Loan Forgiveness Application Portal.
The PPP, which rolled out in April, allowed businesses with 500 or fewer employees to borrow money from lenders guaranteed by US Small Business Administration (“SBA”) to fund up to 2.5 times their average monthly payroll and other expenses, including mortgage interest payments, rent payments and utility payments. If the full time equivalent number of employees were retained throughout the covered period and certain other conditions are also met, businesses may be eligible to have their PPP loan balances forgiven.
BBVA USA announced in May that it had funded approximately $3.3 billion small business PPP loans in less than 60 days, processing more than 22,000 applications and impacting approximately 360,000 jobs through its efforts in the program. For context, the bank - which consistently ranks in the top 15 national lenders in SBA lending - loaned in less than 60 days what it might typically loan in ten years.
With the dust settled from the lending process, now BBVA is helping business owners take the next step to apply for forgiveness.
The key here is gathering all the documents needed
“While there’s still more time to obtain loan forgiveness, the key here is gathering all the documents needed to prove how the money was used,” said Dobers. “Sixty percent of the loan must have been used for payroll, and the other forty percent can be used for other business-related matters like mortgage payments, rent, and utilities.”
Documentation would include proof of rehiring, payroll documents, bills for mortgage, rent and utility payments, among other items.
Beyond documentation, Dobers also preaches patience.
“We have to go by the rules of the program, but things are uncertain right now,” she said. “Banks are here to help. We’re working with the SBA to follow their guidelines and make sure that these small businesses are the ones that benefit. I’d encourage people to watch the webinar, as it goes into further detail and answers many questions floating around right now. It’s 45 minutes, but it’s very informative and worth it.”
The webinar can be viewed by clicking this link, where information can also be found regarding BBVA’s forthcoming Loan Forgiveness Application Portal, and a FAQ section at the bottom of the page.
Other interesting stories