(Don’t know what the PPP is? Read this first.)
One common question we’re getting: “Aaah! I haven’t heard from my existing lender and I’m freaking out about all this news that the funds will run out. Should I apply somewhere else in parallel?”
First, a note about the process itself. Generally, it looks something like:
Worth noting: step 5 is the only step where the funds are actually committed. The concern here, of course, is: if your application is stuck in Step 3 and the initial PPP tranche runs out of money, you’re out of luck—even if you diligently applied last week.
So how should you think about mitigating this risk? With the strong caveat that, as usual, I’m not a lawyer/accountant/tax preparer, that this isn’t legal/financial/tax/accounting advice, etc. etc., here’s our understanding of the world:
Ultimately it’s a judgment call: Will you feel better waiting, with the risk that you don’t get the loan approved before the initial funds run out (and hope that the next tranche is approved soon?) Or will you feel better getting in line in multiple places (with the risk that you have to scramble to unwind any other applications once one is submitted?)
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Thanks! We’ll follow up with updates as we have them.
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