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PPP First Draw FAQs

Please note that Simmons Bank is continually working to update our resources as new information becomes available.

Simmons Bank is not currently accepting PPP loan applications from new customers. Customers who had a previous banking relationship with Simmons Bank, may apply for a PPP loan until March 26, 2021. The March 26 cutoff date is intended to provide sufficient time to process and submit loans to the SBA prior to the March 31 deadline. Due to the SBA review process, approved loans may not be funded until after March 31. Pending legislation may impact these dates.

Existing Simmons Bank customers should contact their banker to apply.

What is a First Draw PPP Loan?

Generally, First Draw PPP Loans can be used to help fund payroll costs, including certain benefits. Funds may also be used to pay for mortgage interest, rent, utilities, certain worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act (including question B. 11) for more information on the use of funds and what qualifies as eligible costs.

What are the requirements for full forgiveness?

Your loan may qualify for forgiveness if certain conditions are met. Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act (including question B. 14) for more information on forgiveness.

What are the terms of the loan?

For PPP loans made on or after December 27, 2020:

  • The loan is 100 percent guaranteed by the SBA.
  • No collateral will be required.
  • No personal guarantees will be required.
  • The interest rate will be 100 basis points or 1%, calculated on a non-compounding, non-adjustable basis.
  • The maturity is five years.

Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act for more information on the loan terms and conditions.

What is the maximum First Draw loan amount?

For most applicants, the maximum loan amount for a First Draw PPP Loan is 2.5 times certain of the borrower’s average monthly payroll costs, up to $10 million. The maximum annual salary per employee is $100,000.

Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act (including question B. 4) for more information on calculating the maximum First Draw loan amount.

Who is eligible for a First Draw Loan?

Many businesses are eligible for a First Draw Loan. The Economic Aid Act also extended eligibility to some organizations that were not previously eligible, including certain nonprofits. To determine if you meet eligibility requirements, see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act or the SBA’s PPP Overview Page.

Simmons Bank will accept PPP loan applications from existing customers until March 26, 2021.

What documentation will I need?

Please submit the following along with your loan application:

  • If the applicant is not self-employed, the applicant’s Form 941 (or other tax forms containing similar information) and state quarterly wage unemployment insurance tax reporting forms from each quarter in 2019 or 2020 (whichever was used to calculate payroll), as applicable, or equivalent payroll processor records, along with evidence of any retirement and employee group health, life, disability, vision and dental insurance contributions, must be provided. A partnership must also include its IRS Form 1065 K-1s.
  • If the applicant is self-employed and has employees, the applicant’s 2019 or 2020 (whichever was used to calculate loan amount) IRS Form 1040 Schedule C, Form 941 (or other tax forms or equivalent payroll processor records containing similar information) and state quarterly wage unemployment insurance tax reporting forms from each quarter in 2019 or 2020 (whichever was used to calculate loan amount), as applicable, or equivalent payroll processor records, along with evidence of any retirement and employee group health, life, disability, vision and dental insurance contributions, if applicable, must be provided. A payroll statement or similar documentation from the pay period that covered February 15, 2020 must be provided to establish the applicant was in operation on February 15, 2020.
  • If the applicant is self-employed and does not have employees, the applicant must provide (a) its 2019 or 2020 (whichever was used to calculate loan amount) Form 1040 Schedule C; (b) a 2019 or 2020 (whichever was used to calculate loan amount) IRS Form 1099-MISC detailing nonemployee compensation received (box 7), invoice, bank statement, or book of record that establishes that the applicant is self-employed; and (c) a 2020 invoice, bank statement, or book of record to establish that the applicant was in operation on or around February 15, 2020.

Can I apply for both an economic injury disaster loan (EIDL) and PPP?

Yes. For an EIDL, you must apply directly through the SBA.

What is the “covered period”?

The “loan forgiveness covered period” is the period beginning on the date the lender disburses the PPP loan and ending on any date selected by the borrower that occurs during the period (i) beginning on the date that is 8 weeks after the date of disbursement and (ii) ending on the date that is 24 weeks after the date of disbursement.

Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act for more information.

When will borrowers be required to begin paying principal and interest on a PPP loan?

If a borrower submits a loan forgiveness application within 10 months after the end of the loan forgiveness covered period, the borrower will not have to make any payments of principal or interest on the loan before the date on which SBA remits the loan forgiveness amount to the lender (or a determination is made that no loan forgiveness is allowed).

Please see the SBA’s Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act (including question B. 9) for more information.

How can I request loan forgiveness?

Your Simmons banker will work with you to submit a loan forgiveness request. Please see our PPP Loan Forgiveness FAQ page for further details.

Are borrowers required to provide demographic information?

To better understand which small businesses are benefiting from PPP, the SBA is requesting demographic information on PPP loan applications. Completion of these questions is optional and will not impact your ability to receive a loan. For additional information, please see PPP Loan Data – Key Aspects.

 

Additional details about First Draw PPP Loans can be found in PPP as Amended by the Economic Aid Act Interim Final Rule (01-06-2021). And on the SBA’s PPP overview page.