Answers to Your Most Pressing PPP Loan Questions

UPDATE: The PPP loan application period ended May 31, 2021. Learn about financing options available for small businesses today at Lendio.com

In just under a year, the Paycheck Protection Program has provided more than 8 million loans totaling more than $700 billion. Demand for relief funding in the form of PPP loans remains strong—3 million of these loans have been approved since the program re-opened in January 2021. A former official at the U.S. Small Business Administration, I helped to implement the PPP, and today I serve as an advisor to lenders and financial services providers like Lendio.

If you’ve applied for a PPP loan but haven’t received your funds yet, you likely have questions about the status of your application. Here are the answers to some of the most common questions about getting a PPP loan through Lendio:

If a lender denies my application, will Lendio find someone else to approve me? And how does that process work?

This depends on the reason for the denial. If it is an adverse action—a duplicate PLP number, the applicant does not qualify, or Lendio is unable to verify the applicant’s identity—it will be difficult to place your application with a new lender. However, if the reason is that the lender is unable to fund, Lendio will do its best to put your application back into the flow for a new lender to approve and fund.

What happens if I sign my documents, withdraw my other applications, and my loan is canceled? Do I have to start over?

Yes, you will have to begin again. Withdrawing your other applications before your funds are disbursed is not the best practice. If that happens, you will start over in the process; Lendio has a dedicated withdrawal team with a specialized process that takes about three days to process.

I’m seeing an “Active Un-Disbursed” status on CAWebb; what does this mean?

The Active Un-disbursed status means you were approved for the PPP loan, have signed your contracts, and are waiting for your funds to be disbursed.

Will the SBA or any other entities do a hard credit inquiry on me if I apply for a PPP loan?

No, your eligibility for the PPP loan does not depend on your credit score. Your credit may be used to verify your identity, but rest assured you will not receive any hard credit inquiries.

Does receiving the PPP Promissory Note mean I’m approved?

A promissory note does not necessarily mean you have been approved. The lender will perform quality checks in addition to the checks that Lendio performs. More of these checks have been implemented because of the increase in fraudulent applications across the program. Some lenders may elect to ask for more documentation after promissory notes are signed, or they may decline to fund due to suspicion of fraud. Promissory notes do not make lenders obligated to fund.

What are some common PPP loan application mistakes that prevent getting an SBA approval?

1. An incomplete application. It is important that you fully complete your application before you submit it to any lender or lender service provider. Don’t leave things blank thinking you’ll communicate them later, as providers must prioritize applications they can immediately identify as complete.
2. Incorrect numbers. Be realistic and honest when completing your application. Don’t inflate your revenue or any other numbers. This will slow down your application as you’ll not be painting an exact picture of your qualification for the loan.
3. Missing documentation. Submit all your required documents. These include bank statements and other documents that are needed based on your entity type. The more documentation you provide, the faster your loan provider can best determine your qualification level and prepare your file for underwriting.
4. Improper documentation. It’s best to submit clean, original versions of your documents. Original PDFs are ideal, scanned copies are the next best thing, and photos of your documents should only be submitted as a last resort. If you can, label each document with the type of form it is.

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Disclaimer: Bill Briggs does not speak for the U.S. Small Business Administration (SBA), the U.S. Department of the Treasury (Treasury), or represent the government in any formal or informal capacity. The views presented here are his own and such views shall not constitute professional services or investment advice. All information in this article is publicly available and accessible and is not material non-public information or proprietary information. Further, any information provided here shall not constitute advice or guidance on behalf of or for the government or independent third parties. For official guidance documents, participants should consult materials presented at www.sba.gov or www.treasury.gov.