SBA Discontinues Reliance on Loan Necessity Questionnaires
On July 29, 2021, the Department of the Treasury published updates to its Paycheck Protection Program FAQs. The updates come in response to the Small Business Administration’s (SBA) decision to discontinue the use of its Loan Necessity Questionnaires (SBA Forms 3509 and 3510).
In October 2020, the SBA issued two Loan Necessity Questionnaires — SBA Forms 3509 and 3510 — to aid in collecting supplemental information by the SBA for evaluating the good faith certification made by PPP borrowers of $2 million or more. The SBA has been reviewing the questionnaires as part of the greater loan review process upon submission of a borrower’s PPP loan forgiveness application.
However, after soliciting comments on the Loan Necessity Questionnaires and considering the current lengthy loan forgiveness review process (which has caused delays beyond the 90-day statutory timeline the SBA has to issue loan forgiveness decisions), the SBA decided earlier this month to discontinue reliance on the Loan Necessity Questionnaires for applicants who have already submitted such responses. Further, the SBA will no longer require Loan Necessity Questionnaires from applicants who file for forgiveness moving forward.
The SBA’s decision should ultimately speed up the loan forgiveness review process for all borrowers. However, be aware that other factors, such as resource constraints and outstanding information requests to lenders, can still delay forgiveness decisions.
Please contact Courtney Keehan, Jim Catanzaro, Justin Furrow, or your relationship attorney if you have questions or need additional information.