Your PPP Loan Amount May Be Wrong [You May Have to PAY IT BACK]

How Long Do You Have To Pay Back A PPP Loan?

The Paycheck Protection Program (PPP) loan is a forgivable loan that helps small businesses and self-employed individuals pay their employees and cover certain other expenses during the COVID-19 pandemic. The loan period is typically two years, with a repayment period of up to five years.

The loan can be used to cover payroll costs, including benefits, mortgage interest, rent, and utilities. The purpose of the loan is to help keep businesses afloat during the pandemic, and the government has promised to forgive the loan if the eligible expenses are used for the designated purpose.

The loan must be repaid within two to five years, depending on the terms of the loan. The repayment period is based on the amount of the loan and when it was received. For loans received before June 5, 2020, the repayment period is two years, and for loans received after June 5, 2020, the repayment period is five years.

Interest rates for the loan are currently set at 1%. Borrowers are not required to make payments on the loan until it is due, which is either two or five years after the loan is received. At that time, borrowers may choose to make payments on the loan or have the entire loan forgiven.

To have the loan forgiven, borrowers must submit a loan forgiveness application to the lender and include documentation of how the loan proceeds were used. The lender will then review the application and determine if the loan can be forgiven.

Key Points:
• The Paycheck Protection Program (PPP) loan period is typically two years, with a repayment period of up to five years.
• The loan can be used to cover payroll costs, including benefits, mortgage interest, rent, and utilities.
• Interest rates for the loan are currently set at 1%.
• Borrowers are not required to make payments on the loan until it is due, which is either two or five years after the loan is received.
• To have the loan forgiven, borrowers must submit a loan forgiveness application to the lender and include documentation of how the loan proceeds were used.

People Also Ask:
Q: How much of a PPP loan can be forgiven?
A: Borrowers can have 100% of the loan forgiven if they use the funds for the designated purpose.

Q: What type of expenses can be covered by the PPP Loan?
A: The loan can be used to cover payroll costs, including benefits, mortgage interest, rent, and utilities.

Q: How long do I have to pay back a PPP loan?
A: The loan must be repaid within two to five years, depending on the terms of the loan. For loans received before June 5, 2020, the repayment period is two years, and for loans received after June 5, 2020, the repayment period is five years.

How Long Do You Have To Pay Back A Ppp Loan – Review

Banks made mistakes in PPP loan application and now business owners may have to pay their PPP loan funds back because their PPP amount was higher than eligible for.

#ppp #ppploan #pppforgiveness #pppapplication #sba #sbaloan

LINK TO VIDEO ON NO AUTO FORGIVENESS FOR PPP UNDER $150K – https://youtu.be/kYIdUqg4f2U

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DISCLAIMER

This video is intended for education purposes and should not be taken as legal or tax advice. You should consult with your financial professionals about your unique financial situation before acting on anything discussed in these videos. Freedomtax Accounting and Multiservices Inc. is providing educational content to help small business owners become more aware of certain issues and topics, but we cannot give blanket advice to a broad audience. Freedomtax Accounting and Multiservices Inc. or its members cannot be held liable for any use or misuse of this content.

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My PPP Loan Is the Wrong Amount. What Can I Do?

If you were surprised at the PPP loan amount you received, is there anything you can do about it?

Maybe you’re worried that the amount is too high and you won’t be able to spend it all and get it forgiven. Or, worse, that your loan is too small and won’t cover your costs.

Unfortunately, there is no official SBA guidance on these questions. So we talked to a few trusted PPP lenders to get their perspective on this problem.

My PPP loan is too big. What should I do?

If your loan was too big and you’re nervous about not being able to spend it correctly and get it forgiven, you can return the funds in full. The SBA has given a grace period allowing you to return the funds before May 14 without any penalties.

If you just want to return a portion of the loan, unfortunately that doesn’t appear to be an option. You can either accept the amount that’s been given to you, or return the funds entirely.

If you’re concerned about your large loan size, your only course of action is to speak with the lender who provided the loan-they may be able to work something out with you, but there are no guarantees. We also recommend sending your lender an email as soon as you realize your loan is too big. That way you have a legal paper trail showing that you had concerns, which may help your chances of leniency and forgiveness later on.

If you end up with excess funds you can’t immediately return, we recommend holding it in your business bank account so you can pay back the funds as soon as the repayment process has been finalized.

Either way, if you’re concerned your loan size is too big, the safest thing to do is to not spend the excess funds.

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