Last night, the Small Business Administration released an update to the Procedural Notice covering PPP Lender Fee Payments and the 1502 Reporting Process.
This covers several updates and clarifications, but the largest item is it provides details on the how the monthly reporting will work on PPP loans. As a reminder, the initial 1502 report on your PPP loans was done to mark them as disbursed and begin the fee payment process. This info is covering the follow-up monthly reports, which will be required for all loans. The relevant section is below below, and you can click here to download the full notice.
What are the ongoing reporting requirements for PPP loans?
Lenders must electronically submit SBA Form 1502 reporting information to the SBA by the later of: (1) May 29, 2020, or (2) 10 calendar days after disbursement or cancellation of a PPP loan. After submitting the initial SBA Form 1502 report, Lenders must submit PPP loan information to SBA on a monthly basis.
Lenders must provide monthly 1502 reports that include loan status information for their PPP loans regardless of whether the borrower made a payment in the current month. (All PPP loans are deferred.) Lenders must continue reporting on a loan until the Lender notifies SBA that the loan has been paid in full.
After a Lender reports a loan as fully disbursed, the Lender must submit monthly PPP 1502 reports on or before the 15th of each month, or if the 15th is not a business day, on the next business day after the 15th. The first monthly PPP 1502 report is due on or before July 15, 2020, however, Lenders are permitted a two-day grace period to report for this month only.
Lenders must continue to use separate 1502 reports for PPP loans and regular 7(a) loans. The regular 7(a) loan 1502 report and payment due dates for calendar year 2020 remain unchanged, as published in SBA Information Notice 5000-19025.
After a PPP forgiveness purchase, if no loan balance remains, Lender must report the PPP loan as paid in full on the next SBA Form 1502 report. If a loan balance remains after forgiveness purchase, Lender must report the reduction in the loan balance for the forgiveness amount on the next SBA Form 1502 report and must service the remaining balance of the loan in accordance with PPP requirements.
Note: A PPP loan should not be reported as “paid in full” simply because it has been transferred to another Lender