There’s been a lot of great news in the last couple of weeks, from the extension of the Paycheck Protection Program (PPP) to an increased distribution effort of COVID-19 vaccines. Both are vital in getting small businesses back on their feet, but we may still take months to really feel the effects of both. Business owners are still struggling and need as much ongoing support as we can give them.
On the positive side, we know the latest round of the PPP began its rollout much slower than the first rounds did—but things are finally starting to pick up and we’re seeing applications across the board now getting approved and funded much faster. Here’s what’s changed in the few weeks:
The policy changes have largely, and wisely, been aimed at helping traditionally underserved business owners get equal access to relief funds. From what we’re seeing, fintech providers are making that a reality with loan sizes coming in around half that of the national average. Still, there are many business owners out there running into problems or getting stalled at specific stages, and we want to help.
If you’re one of the business owners with an application in the queue, rest assured there is still enough time left in the program to receive your funds. There are a few critical stages in the process where applications are getting held up. Here are the common problems and what you can do to keep your application moving forward to funding.
You’ll want to ensure your PPP loan application is as complete as possible, right out of the gate. If you’ve already submitted an application, go back and ensure it is 100% complete. If at all possible, don’t leave anything blank, lenders have to prioritize applications that can automatically be identified as complete.
Additionally, be as realistic and specific as possible when completing your application. If you do go back into your application and make changes, you must re-sign the completed application.
Documentation is critical in this round. With each business entity comes different requirements, so be sure you provide the required documents for your business type. The more documentation you can provide, the better.
Each application must include a color copy of the front and back of a driver’s license or government-issued ID for each business owner who owns more than 20%. Additionally, include a valid voided check, complete business tax returns (ideally from 2019 and 2020), a complete and signed application, a document proving you were in business before Feb. 15, 2021, and a Feb. 2020 bank statement.
If you can, go above and beyond by providing any of the following to prove your business legitimacy: articles of incorporation, utility bill showing the address of the business, a Secretary of State filing, or EIN letter.
If you don’t have an SBA number yet, it means that your application is likely incomplete. You need to provide all of the required documentation; the more you give, the better. If you have provided all of the documentation and still don’t have an SBA number, it is likely that your application has been declined by the SBA or is under review.
If you have an SBA number but no contract yet, your application is likely undergoing or did not pass a fraud review, document review, or a quality control review. To be proactive, provide any of the following: articles of incorporation, utility bill showing address, Secretary of State filing, EIN letter, or other government-issued documentation to prove your business is legitimate and you are the business owner.
If you have received and signed a contract, but it hasn’t been funded, there could be a few reasons. Your application may have errors on the contract, including the wrong name, wrong bank routing number, or incorrect bank account number. It’s also possible your application hasn’t passed the lender’s quality control review.
As Lendio and financial institutions across the country work to process these loans, we are asking applicants to proactively supply as much documentation as possible—it makes all the difference. We know how badly you and your employees need these relief funds, and we want to help you get funded as expeditiously as possible.
Here are some additional helpful resources as you look for documentation requirements and updates:
Answers to Your Most Pressing PPP Loan Questions
New SBA Guidance Brings Changes for Independent Contractors and the Self-Employed