Below is a list of “Frequently Asked Questions” put together by our friends at TD Bank to help answer some of their clients’ questions. This info should be helpful to anyone who received a PPP Loan.
Q: How do I apply for loan forgiveness?
TD Bank will have a digital application process for PPP loan forgiveness. TD will email you (PPP Customers) with more information on how to access our digital application once it is available. It is by invite only and all customers will receive an email from TD when their turn comes up.
Q: Don’t I need to apply for forgiveness as soon as I am eligible?
We strongly recommend that all Customers wait to apply for forgiveness even if they are eligible until final guidance is provided by the government in order to potentially maximize their loan forgiveness amount.
Q: What does the SBA consider qualified expenses?
The actual amount of your forgiveness will depend on the costs incurred and/or paid, as stated in the SBA guidance. Eligible costs at this time may include but not be limited to:
- payroll costs, including employee benefits, tips, commissions and state and local payroll taxes – at least 60% of the loan must be used for payroll costs to qualify for full forgiveness, 40% of the loan amount may be used for expenses such as:
- mortgage obligations such as interest payments (not including any prepayment or payment of principal) on any business mortgage obligation on real or personal (i.e., non-real estate) property incurred before Feb. 15, 2020
- business rent obligations such as rent or lease payments on lease agreements for real or personal property in force before Feb. 15, 2020
- covered business utility payments – payments for electricity, gas, water, transportation, telephone or internet access or service for which service began before Feb. 15, 2020
Please review the SBA’s version of the forgiveness application as well as the SBA and Treasury websites for information and resources on qualified expenditures and other conditions.
Q: What documentation must be submitted with a request for loan forgiveness?
Note that TD Bank is not accepting any documentation or paper applications at this time and will communicate more information to PPP Customers once we have finalized our loan forgiveness process.
We suggest that Customers begin assembling the required documents needed to apply for forgiveness while we build our forgiveness application and process. These may include:
- Bank account statement payroll service reports documenting wages paid to employees
- Federal and State payroll tax filings
- Business mortgage account statements showing interest paid
- Business rent or lease payment statements
- Business utility payments (e.g., electric, gas, water, transportation, telephone or internet)
Q: What impact do Economic Injury Disaster Loans (EIDL) have on the debt forgiveness of PPP loans?
Borrowers who received a COVID-19 related “EIDL Advance Amount” (a quickly disbursed advance of up to $10,000 on an EIDL that does not have to be repaid and is treated as a grant under EIDL rules) should note that:
- They will need to provide that EIDL information on their PPP loan forgiveness application, as required by the SBA;
- The SBA will deduct the EIDL Advance Amount from the forgiveness amount that it sends to the lender; and
- Any remaining balance of the PPP Loan (after deduction of the EIDL Advance Amount) must be repaid to the lender in agreement with the terms of the PPP Loan.
Q: What happens to the remaining balance of my EIDL?
If you received an EIDL in excess of the EIDL Advance Amount (more than $10,000), you will need to repay the balance of your EIDL to the SBA in accordance with its terms.
PPP Payoffs and Payments
Q: How can I make a payment on my PPP loan?
While borrowers are not required to make a payment on their PPP loan during the deferment period, we understand some may wish to do so. Please visit your local Store to make a loan payment through the drive-thru or make an appointment to make a payment in the Store.
Q: I want to pay off my PPP loan. How can I do this?
Customers who wish to pay off their PPP Loan can initiate the request by calling their Store Manager or Relationship Manager. The payoff amount on the loan will be provided within two business days of your request.
Jugmi Rao, VP-Relationship Manager- Business Banking, Northshore Region
TD Bank, America’s Most Convenient Bank