It looks like businesses may get more time to take part in a massive program designed to provide funding.
The U.S. Senate approved Wednesday extending the Paycheck Protection Program, slated to sunset on June 30, through August 8, letting more businesses obtain loans which can be forgiven if they meet certain requirements.
The legislation, still awaiting approval in the U.S. House of Representatives and then requiring President Donald Trump’s signature, would extend a program that began in April with $130 billion still approved and not used.
Many companies initially did not apply or turned down loans, due to the original terms, which required money to be used within eight weeks, especially difficult since many companies were still closed.
That was extended to 24 weeks with 60 percent not 75 percent required to go to salary, and the remainder allowed for rent and some other uses such as utilities.
Neil Seiden, president of Asset Enhancement Solutions, in Uniondale, which has been helping companies apply through the program, said some “companies that were initially hesitant about taking the money” have been applying.
“We got a call from a guy for a $250,000 loan yesterday,” Seiden said. “Because of the forgiveness being extended to 24 weeks, he determined the loan could be forgiven.”
He said that business person operates a hair salon, which at the time of the initial applications had been closed.
“He didn’t apply, because hair salons weren’t open,” Seiden said, noting more time would allow more companies to apply and receive funds. “This will be a big upside for a lot of companies.”
While some companies are applying for the first time, others have had loans declined due to errors in applications, including improper phone numbers or addresses, even though they would otherwise qualify.
“If any of those things are off, that can automatically reject an application,” Evan Siegel, AES’ director of operations, said. “We’ve had situations where an applicant may have put a home address where a business address should go or cell phone number instead of business number.”
AES, he said, identified mistakes made in previous applications, correcting them, and helps companies go through the process. Companies are not charged for the service, which is paid for by lenders.
“There was definitely a push in the last few days to have people get their items in,” Siegel said, noting an extension would let more companies obtain funds. “I think we’ll pick up where we were and continue doing what we were doing.”
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