PPP Cares Act Loan Update
Updated: Apr 7
As a service to our friends and clients the information herein is meant to keep you informed. We at BCCUSA are NOT endeavoring to charge fees or somehow gain from the misfortune this pandemic has presented us- but rather wish to help businesses understand what is going on. We will get through this- together.
To be sure: there is a significant amount of misinformation being speculated, and the reality of the process is still evolving. While we have all seen press about the number of loans successfully processed, to date, we are told by Banks and non-bank lenders that they can’t confirm businesses receiving funds.
The SBA did send an email to lenders on Saturday the 4th indicating the SBA was working on technical issues, including the crash of CAFS (Capital Access Financial System). The CAFS system usually processes approx. 60,000 loans per year, which was surpassed within the first hour of Business this past Friday.
Banks and non-bank lenders have also expressed frustration at the lack of guidance from the SBA regarding what a complete submission package is. Additionally, the SBA still needs to provide clarity to lenders regarding “buyback” provisions. The Government buyback of these loans is a major issue for banks given their 1% interest rate for businesses with diminished revenue (and/or no revenue), no collateral or personal guarantees.
For these reasons we are suggesting that businesses apply at their depository relationship bank. It has been brought to our attention that many Credit Unions do not wish to participate in the PPP program. We will keep you informed which banks are taking applications external of existing relationships as the information becomes transparent and verifiable.
BCCUSA helping you know before you borrow