CORNING, N.Y. (WETM) – On Friday Congressman Tom Reed reminded viewers that the eight-week deadline to spend any money received from the Paycheck Protection Program loans is fast approaching.
In April Congress allocated $349 billion for the Paycheck Protection Program, allowing businesses who were financially impacted by COVID-19 to maintain their payroll. Additional funding was provided after the first round of loans were awarded quickly. The loans were designated to be forgiven in most cases, but in some circumstances, a portion might have to be paid back.
“As long as the borrower is using the funds for payroll the loan should be forgiven as long as they can provide the documentation showing that during those eight weeks that they used those funds for payroll,” said Courtney Woods, Supervisor of Business Lending at Corning Credit Union.
“Anyone who has a Payroll Protection loan currently and would want forgiveness on the loan would apply for forgiveness. It would be determined through the forgiveness application if they have a portion of the loan that would not be forgiven.”
If the SBA determines that a portion of the loan can not be forgiven, then the remaining amount plus a 1% interest rate over two years would be applied. All loan payments have been deferred for six months.
Borrowed $50,000 and $35,000 is forgiven. The remaining $15,000 would be paid in monthly installments for 18 months remaining in the 24 month loan term as SBA waived the first 6 months of payments.
Anyone with questions regarding the Paycheck Protection Program loans is advised to contact their loan provider or a trusted financial advisor.
So far Corning Credit Union has assisted around 400 business members with roughly $25 million in Paycheck Protection Program loans.