By Ken Ferreira
Executive Vice President & Chief Credit Officer
Vision One Credit Union
Mistakes will slow down approval of your Paycheck Protection Program 2 application, or may cost you forgiveness. These are the seven most common mistakes we have seen at Vision One Credit Union on the PPP2 applications we have processed.
Vision One Credit Union
(Vision One) is the only financial institution dedicated solely to independent optometry.
• We understand the business of optometry.
• We take the time to understand your goals and help you implement a financial plan to achieve them.
• We know you and take your calls. It’s about “relationship and high service levels,” not “sales.”
The difference between Vision One and other financial institutions is similar to the difference between independent and retail optometry.
Vision One Credit Union was founded in 1951 by ODs for ODs to enhance and perpetuate private practice optometry, exclusively. We are non-profit and mutually owned by our depositors. All deposits are reinvested back into private optometric practices.
Achieving practice growth and value requires continual investment. This necessitates a reliable ongoing banking relationship.
Since who is on your team matters, experience the “Benefits of Membership” at Vision One Credit Union. You will appreciate the difference.
Contact us today for a practice business banking review so that we can help you move your practice to the next level.
Monday through Friday
7:30 a.m. to 4:30 p.m. (Pacific Time)
PPP2 APPLICATION MISTAKES
1) The “Business Legal Name” and Business TIN (EIN, SSN) entered on the application must be the exact same information you filed with the state in which you are doing business. The SBA will run third-party database checks to validate this information. If this information is not 100 percent accurate, the application will be held up by the Small Business Administration (SBA).
2) All questions on page 1 must be answered and #4, #5 and #8 must be initialed. If any of these are not answered, or if questions #4, #5, and #8 are not initialed, then the application will be held up by the SBA.
3) If the practice is not a franchise, Question #8 on page 1 of the Second Draw PPP Loan Application still requires a response. Not answering this question is a common mistake we see.
4) All certifications required on the application must be initialed. The application cannot be accepted if the certifications are left blank. Borrower notes or responses outside of an initialed response are not acceptable.
5) Another mistake we see is a missing signature. The application requires a hard signature or an electronic signature. An application cannot be processed or reviewed without it.
6) Missing documentation is another common mistake we see. If the amount of the Second Draw PPP Loan exceeds the amount of the First Draw PPP Loan this indicates that different financial information is being used to support the Second Draw PPP Loan than was used to support the First Draw PPP Loan. A 12/31/2020 Profit & Loss Statement is required to support the increase for the Second Draw PPP Loan Application.
7) Another common documentation mistake we see is when the First Draw PPP Loan was provided by a lender other than the lender providing the Second Draw PPP Loan. If a new Second Draw PPP lender is used, the documentation required to support the First Draw PPP Loan is required to be submitted to the Second Draw PPP lender. Page 4 of the Second Draw PPP Loan provides guidance related to the required supporting financial information.
Make sure to retain the financial information and documentation that will be required to support the Second Draw PPP Loan Forgiveness Application as indicated in the SBA instructions for completing the Second Draw PPP Loan Application. This information will be required for the Second Draw PPP Loan Forgiveness Application and will be subject to review by the Lender and SBA.
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There are two key takeaways for you:
• The U.S. Small Business Administration (SBA) will validate information on your application through third-party sources.
• Keep all the documentation you submit for PPP1 and PPP2 for both the loan applications and the forgiveness applications in a safe, secure and easily accessible place.
Avoid these seven mistakes to make sure both your PPP loan application and forgiveness application are processed as quickly as possible.