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The PPP is out of money. Now what?

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Don’t despair. The status of the Paycheck Protection Program loans is changing fast. The latest update from a mainstream news source says that Congress will continue to hash out funding. As of press time, Congress could not come to an agreement, so both PPP and Economic Injury Disaster Loans will remain on hold until next week. 

But you have other options for help right now.

The PPP ran out of money before I had a chance to apply or was approved. What do I do now?

Watch and wait. The program isn’t shuttered just because it ran out of money, noted Stephen Amdur, a private equity lawyer appearing in the New York Times DealBook audioconference on Wednesday.

Amdur believes Congress will offer a new infusion of cash. The PPP may be expanded or a new program put in place.

If or when the program receives more funding, remember that your bank is not your only source of PPP loans. Online lenders like QuickBooks Capital, PayPal, Square, Lendio, and Kabbage have received permission from US Treasury Department to deliver PPP loans, according to business advisor Gene Marks, in the same audioconference.

It is difficult to find information about the SBA loans on commercial lenders’ websites. So, NEWStat did the digging for you. Here are links, good as of April 16. Note that these lenders are examples, not recommendations.

Live Oak Bank

Status: We did not find a link to an application. However, the Live Oak Bank site offers several downloadable resources and a link to a searchable database of SBA-approved lenders.

QuickBooks Capital

Status: Still ramping up. Promises to be streamlined for customers of QuickBooks Payroll. As of April 16, the QuickBooks Capital site says:

We’re committed to providing access to the relief your business needs. We’re working as quickly as possible to launch a simple application and funding process for the Paycheck Protection Program directly within QuickBooks.

Go here for how to apply, including an FAQ. Go here and scroll down for a list of documents you’ll need, no matter where you apply.

PayPal

Status: Discontinued until Congress approves new funding. The PayPal site says:

Because the funding allocated by the US Government for the Paycheck Protection Program has been fully distributed, we are currently not accepting new applications.

If more funding is designated for this program, we plan to make the application available again. If you have already applied, we will be contacting you through email.

This site also includes loan basics, the three steps to loan forgiveness, documents you’ll need, and links to all the details from the Small Business Administration.

Square

Status: Still ramping up. The Square site says:

We can’t accept applications just yet, but we want to help get this money into your hands as soon as possible.

Please refer to this application guide we’ve created to help you understand the program, as well as what documentation and calculations you’ll need to apply for the funding

Lendio

Status: Discontinued until Congress approves new funding. The Lendio site says:

The SBA just announced it will soon be unable to issue new loan approvals for PPP funds.

Lendio has done everything possible to submit every completed PPP application. Approvals are still happening, but more funds are needed. Along with the SBA, Lendio urges Congress to appropriate additional funds.

Kabbage

Status: Loan origination. Connects borrowers to lenders. Discontinued until Congress approves new funding. The Kabbage site says:

At this time, Kabbage is offering Paycheck Protection Program (“Program”) loans on behalf of one or more approved U.S. Small Business Administration (“SBA”) lenders. Loan agreements will identify the lender to small businesses at signing, and any loan made under the Program must also be submitted to and approved by the SBA. Program funds are limited. Kabbage does not guarantee that applications will be processed and submitted before Program funding is no longer available. There is no cost to you to apply for a Program loan. Applying with Kabbage does not limit you from applying with other lenders and/or platforms.

Kabbage makes it clear you can apply with more than one lender—but business advisor Gene Marks warns that the SBA will consider only one loan application per federal ID number.

“The online lenders are doing something I wish bankers would do,” Marks said. “The online lenders see this as an opportunity to build relationships with small businesses.” In most cases, he said, you don’t need a prior business relationship to apply with financial technology lenders.

What’s next if your application was denied or the loan is disappointingly small?

You can apply for a PPP loan only once. If you’re rejected or approved for a lower amount, as of April 16 you can’t reapply, and you can’t appeal. “That’s my understanding of how it is right now,” Marks said.

But things change. “A lot of these rules are being written as we go,” Amdur adds. The SBA may adopt new rules, or it may put an appeals process in place.

You may want to look to other sources as well. When it comes to giving money away, “It’s not just the feds,” Marks said. “Some corporate grant programs could help see you through this.” For example, Facebook has committed $100 million in grants to fund 30,000 small businesses around the world.

The key takeaway from the DealBook conference is: look broadly and be persistent.

And, whatever your financial situation, heed the following advice from Marsha L. Heinke, DVM, EA, CPA, CVPM, and Jennifer M. Braid, CPA, EA:

“Ideally, your practice management team will collaborate with your certified public accountant (CPA) and other advisors to strategically determine the best plan of action based on staffing, capital structure, local COVID-19 impact, and much more. . . .

“This unprecedented time especially warrants seeking and paying for expert assistance. Because of the rapid rollout of the recent rescue laws, the SBA, Internal Revenue Service (IRS), and Department of Labor are scrambling to write regulations and provide coherent guidance that reflects the legislative intent. There continues to be an incredible amount of confusion, misinformation, and conflicting directives.

“The time involved in planning, understanding, organizing requisite documentation, and successfully completing applications has been substantial. To keep your practice on track for application success, seek help from your practice’s expert advisors.”

Photo credit: © iStock/maleropaso