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Free in Google Play

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Magyar Bank
Free in the App Store

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Magyar Bank
Free in the App Store

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Important Updates on Paycheck Protection Program (PPP)

Updated April 5, 2021

As a result of the recently signed stimulus package, a new round of PPP funding is available to qualified businesses. Magyar Bank will once again participate in this program. At this time, no date has been set as to when Magyar Bank will be allowed to submit applications to the SBA, but we expect to be able to do so very soon. Updates will be provided as soon as this information becomes available. 

There are different guidelines and applications for businesses who received a PPP loan previously. Below is a summary provided by the SBA regarding the requirements for each situation, and the application that is required to be completed. 

The deadline for applications has been extended to May 31, 2021.

First Time Applicants

First Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism
during 2020, and certain supplier costs and expenses for operations.

Full Forgiveness Terms
First 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;
  • 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.

Who Can Apply

  • Eligible small entities, that together with their affiliates (if applicable), have 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors—can apply.
  • Entities with more than 500 employees in certain industries that meet SBA’s alternative size standard or SBA’s
    size standards for those particular industries can also apply

Reapplying and Loan Increases

  • Existing PPP borrowers that did not receive loan forgiveness by December 27, 2020 may:
    • reapply for a First Draw PPP Loan if they previously returned some or all of their First Draw PPP Loan funds, or
    • under certain circumstances, request to modify their First Draw PPP Loan amount if they previously did not accept the full amount for which they are eligible.

The application for first time borrowers is below.

PPP Round 2 First Draw

Second Draw Applicants

Second Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

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.

Targeted Eligibility
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

Maximum Loan Amount and Increased Assistance for Accommodation and Food Services Businesses
For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector, the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.

PPP Round 2 Second Draw

 PPP Loan Forgiveness Applications 

On January 19, 2021 the SBA released a simplified forgiveness form for PPP loans of $150,000 or less. The revised Form 3508S does not require the borrower to submit supporting documentation of how their PPP funds were spent. Borrowers are required to certify and attest that they have complied with the requirements of the Program. This is a one page form and can be accessed below. To submit your Forgiveness application, please download this form and return to your Relationship Officer.

For loans under $150,000, you may use Form 3508S below.

PPP Loan Forgiveness Form 3508S

For borrowers with PPP loans over $150,000, you may use Form 3508EZ or Form 3508. Qualifications to determine which form to use are available on the SBA website.

PPP Loan Forgiveness Form 3508EZ

PPP Loan Forgiveness Form 3508

Instructions for all these forms, along with details about the PPP Loan Forgiveness process is available on the SBA website.

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