The US Treasury has published initial guidance (a Borrower’s Guide) on the Paycheck Protection Program (PPP) loans through the SBA and the form of application. Below are some of the top-lines from that guidance that provides clarification on the interest rate, loan term, and loan forgiveness for qualifying expenses other than payroll costs:
- Non-payroll qualifying expenses for loan forgiveness could be capped at 25% of the forgiven amount
- The guide is saying that the loan term will be 2 years (note the CARES Act indicated a maximum term of 10 years)
- The interest rate will be 0.5% fixed (note the CARES Act indicated a maximum of 4%)
- Businesses can start applying April 3. Independent Contractors and Self-employed persons can start applying on April 10.
