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FAQs About Round 2 Of The Paycheck Protection Program (PPP)

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Erica Seppala

Erica Seppala

Erica is a writer based in Greenville, South Carolina. She is a graduate of Limestone College. Initially determined to be an accountant, she put away the calculator and picked up a laptop to pursue her dream of being a writer. Erica has spent the past 10 years writing blogs and articles for hundreds of private clients, and she loves sharing her love of research and the written word with everyone around her.

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13 Comments

Responses are not provided or commissioned by the vendor or bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the vendor or bank advertiser. It is not the vendor or bank advertiser's responsibility to ensure all posts and/or questions are answered.

    Tracie

    Is there a credit score requirement?

    Thanks

      Jessica Dinsmore

      Hi Tracie,

      There is not a specific credit score requirement, though they do look into overall creditworthiness. We have a post on PPP Loans & Credit Scores that will clarify.

        Anna

        As a self-employed individual who will pay themselves the entire amount through OCR, how soon after receiving a 1st loan can you apply for a 2nd loan?

          Jessica Dinsmore

          Hi Anna,
          You can apply for a second loan once all conditions have been met. These conditions are that the first draw has or will be used for eligible expenses, the business has no more than 300 employees, and you can demonstrate at least a 25% reduction in gross receipts from the same quarters in 2019 and 2020.

            Vinh

            I’m told i’d have to wait 8 weeks to use all my first round funds before applying for the second round. But since I’ve hired more people since 2020 and will exhaust it much sooner. Can i still apply before the 8 weeks are over?

              Jessica Dinsmore

              Hi Vinh,
              You must have already spent or plan to spend all funds from your first loan in order to qualify for a second draw. I think this post “Round 2 PPP Loans Explained: Rules, Requirements, & Where To Apply” will help answer your questions.

                Jessica Dinsmore

                Hi Anna,

                You can apply for a second loan once all conditions have been met. These conditions are that the first draw has or will be used for eligible expenses, the business has no more than 300 employees, and you can demonstrate at least a 25% reduction in gross receipts from the same quarters in 2019 and 2020.

                  ronnie sanders

                  i have applied for the second ppp loan and was turned down due to my company filing a chapter-11 bankruptcy which is restructuring our business.we are still running and need the money to help keep us running.we have been in business for approx.32 years.please let me know if you cam help with this matter.Thank You-Ronnie Sanders

                    Jessica Dinsmore

                    Hi Ronnie,

                    Unfortunately, while the Consolidated Appropriations Act of December 2020 did contain language that would allow businesses filing bankruptcy to qualify for PPP loans, most people (specifically, businesses filing traditional Chapter 11 bankruptcy) won’t qualify. It’s a pretty lengthy process. The SBA would have to state to the Office of the United States Trustee that the business is eligible to participate, a hearing would need to be held to give permission for the business to receive the PPP loans, etc. You can attempt to contact the SBA to find out what additional steps or options are available for your specific situation because, ultimately, it’s going to be up to the SBA and a bankruptcy court to determine if your business is eligible. Good luck!

                      Metrotexas

                      Exactly what type of documents do I submit for the second round of PPP? I read all the documents and scanned to PDF, but now Bank of America is requesting different documents. I’m not sure what to send them?

                        Jessica Dinsmore

                        Hi there,
                        Bank of America has a list of documentation requirements for PPP loans. It should be noted that these documents are required for first draw loans. With second draw loans, you will need to access the PPP application through the Business Advantage 360 portal and wait for further steps and documentation requests from BofA.

                          Jen Mitchell

                          How long do we have to use the PPP in the second round? Is it 8 weeks or the extended 24 weeks like the first round?

                            Jessica Dinsmore

                            Hi Jen,

                            The Treasury Dept has released this statement regarding the second round of PPP loans:

                            Full Forgiveness Terms
                            Second Draw PPP Loans made to eligible borrowers qualify for full loan forgiveness if during
                            the 8- to 24-week covered period following loan disbursement:
                            • Employee and compensation levels are maintained in the same manner as required for the
                            First Draw PPP loan;
                            • The loan proceeds are spent on payroll costs and other eligible expenses; and
                            • At least 60 percent of the proceeds are spent on payroll costs.

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