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The Small Business Administration last night issued an interim final rule providing clarity on the 10-day loan disbursement requirement under the Paycheck Protection Program, as well as the filing required to receive the lender processing fee.
Moving forward, lenders must make a full, one-time disbursement of PPP loan funds within 10 calendar days of the loan being approved—that is, when a loan is assigned an SBA loan number. (If the end of this period falls on a weekend, or federal holiday, the final day will be the next business day.) For loans approved but not fully disbursed before the issuance of this rule, the 10-day period begins April 28.
However, SBA said, “lenders are not responsible for delays in disbursement attributable to a borrower’s failure to timely provide required loan documentation, including a signed promissory note.” If borrowers do not submit their required documentation within 20 calendar days of approval, the loan will be canceled.
To receive their lender processing fee, lenders must fully disburse the loan and file the yet-to-be-released SBA Form 1502 within 20 calendar days after the loan is approved. For loans approved before Form 1502 is made available, the form must be filed by May 18. If a borrower cancels the loan before disbursement or voluntarily terminates it and repays it after disbursement, the lender will not receive a processing fee. Click here to read the interim final rule.