Thousands of business owners took out PPP loans during the Covid-19 pandemic to keep their businesses afloat. A large majority of those business owners did so under the impression they would be eligible for the Bank of America PPP loan forgiveness program. Unfortunately, those hopes have been shattered as they are finding out they will probably be repaying those loans for a very long time, even if they are eligible for forgiveness.
Who is Eligible for Bank of America PPP Loan Forgiveness
Initially, all loans taken under the Paycheck Protection Program (PPP) were meant to be forgiven. It was one of the first forms of aid that Congress offered small businesses. If the loans were used specifically to cover payroll and certain specified expenses, then they were to be forgiven by the Small Business Administration (SBA) who oversees the program.
Now the guidelines and rules that govern the PPP program have changed since its inception, but lending practices didn’t always change to reflect the new guidelines. Bank of America was one of the leading PPP lenders. Since they were handsomely compensated by the government for their role, they continued making PPP loans they had no intention of forgiving. Unfortunately, they didn’t tell the applicants.
Applying for PPP Loan Forgiveness
Many who received their PPP loans through Bank of America were told they were lent too much money and only a portion would be forgiven. Borrowers say they followed the rules as they were written at the time the funds were disbursed but most have been told they are not eligible for full Bank of America PPP loan forgiveness. The screen where they would apply through Bank of America is pre-populated with an amount equal to a small fraction of their PPP loan.
Since the SBA oversees the PPP, they have set up their own online portal where borrowers can apply directly for forgiveness. The caveat is that their bank must opt in to the portal and Bank of America refuses to do so. Borrowers with a Bank of America PPP loan cannot go directly to the SBA for loan forgiveness. If Bank of America doesn’t opt-in, many customers will never receive Bank of America PPP loan forgiveness. Bank of America says it’s a waste of time to opt in and they know they have many borrowers over a barrel.
Help for Those with Unforgiven PPP Loans
Many of those business owners bit the bullet and took on a second job to repay money they say they shouldn’t owe. They are finding that Bank of America is taking most of those payments in the name of finance charges. According to the SBA, unforgiven PPP loans should accrue interest at a rate of one percent annually.
It seems that Bank of America has been less than forthcoming with their lending practices when it comes to PPP loans and many are seeking professional help. Borrowers are unable to apply for PPP loan forgiveness directly through the SBA and are finding it necessary to partner with a reputable law firm who can best represent their interests. Simply giving up isn’t an option.
Bank of America has consistently marketed PPP loans as 100 percent forgivable. Borrowers felt that they were being given a lifeline when they needed it most, only to find out they were deeper in debt than ever before. Taking the step to partner with an experienced law firm who can investigate the matter gives these borrowers hope that there is light at the end of the tunnel.
If you are a borrower who has been denied PPP loan forgiveness from Bank of America, consider seeking the counsel of a skilled attorney who can investigate and protect your rights under the Coronavirus Aid, Relief, and Economic Security Act (CARES) of 2020. They’re your rights so partner with someone who can help you protect them.