PPP Loans Less Than $2 Million Deemed In Good Faith

PPP Loans Less Than $2 Million Deemed In Good Faith

The SBA has issued a new interim rule creating a safe harbor for PPP borrowers who received less than $2 million. This means, the certification concerning the necessity of the loan request made in good faith be true.

SBA stated the safe harbor was appropriate because:

  • Such borrowers are generally less likely to have had access to adequate sources of liquidity.
  • It will promote economic certainty as PPP borrowers endeavor to retain and rehire employees.
  • It will enable SBA to conserve its finite audit resources and focus its reviews on larger loans, where the compliance effort may yield higher returns.

For more information, read the updated Paycheck Protection Program Loans FAQs issued by the Department of Treasury on May 13, 2020.