SBA Procedural Notice 5000-20083: Platform Procedures for Unresolved Issues on First Draw PPP Loans (January 26, 2021)

Summary

SBA Procedural Notice, Control No. 5000-20083, effective January 26, 2021, to all SBA employees and Paycheck Protection Program lenders on SBA Paycheck Protection Platform procedures for addressing unresolved issues on borrower First Draw PPP loans. It says that beginning Wednesday, January 27th the platform will process Second Draw PPP loan guarantee applications for borrowers with an unresolved First Draw issue by moving them to a research status where lenders can submit supporting documentation. It says lenders should respond timely and withdraw the Second Draw application if the borrower believes the issue cannot be resolved, and should resubmit applications rejected before January 27, 2021 for this reason. The notice is issued over the name of Jihoon Kim, Director, Office of Financial Program Operations.

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Cite this document

“SBA Procedural Notice 5000-20083: Platform Procedures for Unresolved Issues on First Draw PPP Loans (January 26, 2021).” Original at home.treasury.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/department-of-the-treasury-guidance-on-ppp-procedures-for-addressing-u-0f27e8a3f9/, SHA-256 cec8c8f1474569dba5b281aa15618e75890a96e990aef1ff5f4ae6a6ab42cc72.

Full text

                      SBA Procedural Notice

TO: All SBA Employees and Paycheck                                                 CONTROL NO.: 5000-20083
Protection Program Lenders
                                                                                   EFFECTIVE: January 26, 2021
SUBJECT: SBA Paycheck Protection Platform
Procedures for Addressing Unresolved Issues on
Borrower First Draw PPP Loans



This Notice is to inform SBA employees and Lenders of upcoming SBA Paycheck Protection
Platform (platform) procedures to address loan processing for Second Draw PPP Loan guarantee
applications where there is an unresolved issue on the Borrower’s First Draw PPP Loan.

As outlined in the Interim Final Rule for Second Draw PPP Loans, if a First Draw PPP Loan is
under review pursuant to PPP rules and/or information in SBA’s possession indicates that the
Borrower may have been ineligible for the First Draw PPP Loan it received or for the loan
amount received by the Borrower, the Lender will receive notification from SBA when the
Lender submits an application for guarantee of a Second Draw PPP Loan (“unresolved
Borrower”). See 86 FR 3712, 3722 (January 14, 2021).

Beginning on Wednesday, January 27th, the platform will begin to process new Second Draw
PPP Loan guarantee applications for unresolved Borrowers. These Second Draw submissions
will be moved automatically to a research status, and the platform will provide the Lender an
opportunity to submit documentation into the platform to support the resolution of the
outstanding First Draw issue(s). SBA will provide information regarding the unresolved issue(s)
and guidance as to types of documentation that may assist with resolution. It is imperative that
Lenders respond timely, as SBA will need time to review the documentation to determine
whether the unresolved issue(s) can be cleared. Lenders should work with their Borrowers to
assess the situation. If the Lender and the Borrower feel confident that the issue(s) can be
resolved, they should obtain the necessary documentation and the Lender should submit it to the
platform. Once resolved by SBA, these Second Draw Loan guarantee applications will be
automatically submitted into the next stage of processing and will not require re-entry by the
Lender. If the Borrower believes that there is an issue that cannot be resolved, the Second Draw
PPP application should be withdrawn by the Lender in the platform.




PAGE 1 of 2                                                                                EXPIRES: 1-1-22
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58

                                   Federal Recycling Program   Printed on Recycled Paper
Lenders that submitted a Second Draw PPP Loan guarantee application before January 27, 2021,
that was rejected due to an unresolved issue with the First Draw PPP Loan, should resubmit
these applications.

Additional details can be found on the technical documentation provided to all platform API
vendors. SBA will provide additional instructions in the Platform User Guide to reflect any
changes to the platform.

For more information on the next round of PPP, see PPP as Amended by Economic Aid Act (86
FR 3692, January 14, 2021) and PPP Second Draw Loans (86 FR 3712, January 14, 2021).
Additional resources pertaining to the Economic Aid Act and PPP – including application forms,
Lender guidance, and PPP program rules – can be found on SBA’s PPP website or the U.S.
Treasury PPP website.

Questions:
Questions concerning this Notice may be directed to the Lender Relations Specialist in the local
SBA Field Office, which can be found at https://www.sba.gov/tools/local-
assistance/districtoffices.




Jihoon Kim
Director
Office of Financial Program Operations




PAGE 2 of 2                                                                                EXPIRES: 1-1-22
SBA Form 1353.3 (4-93) MS Word Edition; previous editions obsolete
Must be accompanied by SBA Form 58

                                   Federal Recycling Program   Printed on Recycled Paper

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Original: home.treasury.gov