Commercial Lending

At this time, DCU is not accepting new PPP applications.

The exact documentation required varies depending on the type of business as well as how funds were used. However, in preparation for your Paycheck Protection Program (PPP) forgiveness application, DCU has created two charts which outline the documents that you will need to complete and submit with your application. DCU recommends that you start gathering these documents now as you will need information from these documents to complete your application. You are also required to upload these documents in order to submit your application. You can view both charts here.

Small business needs have changed as the COVID-19 crisis has progressed over the past several months. PPP was originally created to provide short-term financial relief to small businesses and Congress has made several revisions and amendments to the program to extend assistance while the pandemic continues. The PPP Flexibility Act, passed by Congress on June 5, 2020 changed some fundamental aspects of the existing PPP, therefore the guidelines for forgiveness must be adjusted as well. DCU is in the process of finalizing our forgiveness application system to reflect these changes. We anticipate launching our application system in the near future.  Please keep in mind that PPP borrowers have up to 10 months from the last day of their covered period to apply for forgiveness.

The PPP Flexibility Act has changed the following requirements:

• Now only 60% of your total loan amount needs to be used for payroll costs, with no more than 40% of your loan to be used for non-payroll expenses, such as rent, utilities, etc.
  
  
• PPP borrowers with loans approved prior to June 5, 2020 may now choose to use a covered period of either 8 weeks OR 24 weeks. The original PPP regulations stated that all loan funds must be used entirely within 8 weeks. 
  
  
• PPP loans approved on or after June 5^, 2020 now have a covered period of 24 weeks.
  
  
• PPP borrowers with loans approved prior to June 5, 2020 now have the option of changing the term on the unforgiven portion of their loan from the current 2-year term to a term of 5 years. No changes to the loan term need to be made until borrowers have applied for forgiveness for their PPP loan.
  
  
• PPP loans approved on or after June 5, 2020 have a default term of 5 years for any unforgiven amount of the loan.
  
  
• All PPP borrowers, regardless of the date the loan was approved, have up to 10 months from the last day of their covered period to apply for forgiveness before payments are due.
  
  
• For sole proprietors and self-employed individuals, owner compensation is calculated based on your 2019 net income. If using an 8-week covered period, divide the 2019 net income by 52, then multiply that amount by 8. Owner compensation for an 8-week period cannot exceed the amount of $15,385.00. If utilizing the 24-week covered period, divide your 2019 net income by 12, then multiply that amount by 2.5. Owner compensation for a 24-week period cannot exceed the amount of $20,833.00. 
  
  
• A new safe harbor was established which created two new exemptions based on employee availability in which a reduction in FTE employees would not affect a PPP borrower’s forgiveness amount. During the period between February 15, 2020 and December 31, 2020, loan forgiveness is determined without regard to the FTE employee reduction if a PPP borrower, in good faith, is able to document that (1) they cannot rehire previously employed individuals or qualified employees; or (2) they are unable to return to the same level of business activity that the business was operating at before February 1, 2020 due to compliance with requirements established or guidance issued by the Secretary of Health and Human Services, the Director of the Centers for Disease Control and Prevention or Occupational Safety and Health Administration relating to the maintenance of sanitation and social distancing due to COVID-19.
  
  
• All PPP borrowers have the right to change the term of their PPP loan and we will address term changes in the near future.

FTE employee stands for “full-time equivalent employee” and is a figure used to calculate your forgivable loan amount. Instructions for how to calculate FTE start on page 4 of the Interim Final Rule on Loan Forgiveness.

The covered period is the number of weeks that you utilized your PPP funds. For PPP applications approved prior to June 5, 2020, your covered period will be 8 weeks or 24 weeks, depending on which of these timeframes you chose. If your PPP application was approved on or after June 5, 2020, your covered period is 24 weeks. 

Everything from completing the application to submitting documents will be done online. DCU will not be accepting any paper applications to ensure the forgiveness process moves as quickly as possible. You will receive an email with a link to your application, which will be prepopulated with the details of your specific PPP loan. You will be able to update the online application and the system will use the information you provide to calculate the forgivable amount of your loan. You will also be able to upload and submit documents that support the information you provided directly through the online portal.

Please make sure that the email on file for the Membership under which you applied for the PPP is the best means of contacting you. We will only be contacting the primary email on Memberships with open PPP loans, regardless of what email you used on your PPP application or any email addresses you may have used to contact DCU in the past. If you are unsure of the email on your Membership, please send your preferred email address to ppp@dcu.org.

The SBA expanded the eligibility requirements for businesses with owners who have past felony convictions. The changes made to the PPP application are as follows:

The eligibility threshold for those with felony criminal histories has been changed.  The look-back period has been reduced from 5 years to 1 year to determine eligibility for applicants, or owners of applicants, who, for non-financial felonies, have (1) been convicted, (2) pleaded guilty, (3) pleaded nolo contendere, or (4) been placed on any form of parole or probation (including probation before judgment).  The period remains 5 years for felonies involving fraud, bribery, embezzlement, or a false statement in a loan application or an application for federal financial assistance.  The application also eliminates pretrial diversion status as a criterion affecting eligibility.

You will receive an email with a link to your specific application. You will need to provide the name as it is listed on your PPP application (individual name or the name of the business) and the tax ID listed on your PPP application (SSN or EIN) to login. Then, you will be prompted to create your own password. You will be allowed to save your application and continue it later if needed.  

No, our forgiveness application will closely mirror the applications released by the SBA. We recommend that you read the instructions for forgiveness applications here.

DCU’s application system will calculate the amount of your PPP loan that is eligible to be forgiven. This amount will be calculated using the guidelines provided by the SBA. The SBA will review each application and determine the final forgiveness amount. DCU will only be reviewing applications to ensure they contain all the information and documentation required for submission by the SBA and will not be involved in determining forgiveness amounts in any way.

No, your forgiveness application can be completed by anyone authorized to sign on the behalf of the business regardless of who applied for or signed the loan documents for the PPP loan originally. Please be advised that the forgiveness application does not currently require proof of the applicant’s authorization to sign on the business’s behalf, such as incorporation documents, partnership agreement, etc. However, we recommend that you keep these documents readily available in case they are requested by the SBA.

No, only an individual authorized to sign on behalf of the business can complete the application. This is because the application must be completed online and signed electronically. Thus, the person completing the application must also be the one to sign it. 

No, forgiveness applications will be randomly assigned to a loan officer for review. 

DCU is required to review your application and send it to the SBA no more than 60 days from the date your application is submitted. However, we anticipate that we will be reviewing applications much faster than this. The SBA can take up to an additional 90 days from the date your application is submitted to them to provide a decision on your application. 

Your first payment is due when the SBA issues the forgiveness amount, or the SBA notifies DCU that no forgiveness is granted. If you do not submit a forgiveness application, then your first payment is due 10 months from the last day of your covered period.

If the total amount of your PPP loan is forgiven by the SBA, all accrued interest will be forgiven in full. However, if only a partial amount of your PPP loan is forgiven, you will need to pay interest on the unforgiven portion. The amount of interest that has accrued during the deferment period will then be prorated so you are only required to pay interest on the unforgiven portion of your loan.

These bills are automatically sent each month and serve as a reminder to apply for PPP forgiveness as your due date approaches. You do not need to take any action in response to these bills. Furthermore, your first loan payment amount will be adjusted either at the time your loan is processed for forgiveness OR no later than 10 months from the last day of the covered period, whichever comes first. Please note that bills are calculated using the original terms of the loan. However, your final payment amount and loan terms will be adjusted to reflect the final unforgiven amount of your loan as well as the new term of your loan. DCU also recommends that you keep these bills for your financial records.

DCU recommends that you document the use of your PPP loan funds with as much detail as possible. You may want to reach out to your accountant, attorney, or tax advisor for assistance on how to document the use of your funds. We also request that you make sure that the email address on your DCU Membership is current. We will be contacting you about PPP forgiveness via the email address listed on the Membership under which you applied for the PPP. We also recommend that you familiarize yourself with the guidelines of the PPP by visiting this website as well the other resources referenced in these FAQs. Should you have any general questions about the forgiveness application or process, please contact DCU at ppp@dcu.org.