Paycheck Protection Program

Bank of Botetourt is an approved SBA lender, and we value all of our small business customers.  The Small Business Administration (SBA) has communicated that Paycheck Protection Program (PPP) funding has been exhausted and that the PPP application portal has stopped accepting applications for loans. Therefore, Bank of Botetourt is unable to accept or process any First or Second Draw PPP applications at this time. Thank you for your patience and understanding.  

All forgiveness applications and information should be sent to the covidloan@bankofbotetourt.com email address. 

Loan Details

The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.

The SBA may forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.  

  • PPP loans have an interest rate of 1%.
  • Loans issued prior to June 5 have a maturity of 2 years. Loans issued after June 5 have a maturity of 5 years.
  • Loan payments will be deferred for borrowers who apply for loan forgiveness until SBA remits the borrower's loan forgiveness amount to the lender. If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
  • No collateral or personal guarantees are required.
  • Neither the government nor lenders will charge small businesses any fees.

PPP Loan Forgiveness Resources

As part of Bank of Botetourt’s ongoing efforts to help small businesses overcome the unprecedented challenges of forced closures and subsequent loss of revenue, we want to help you maximize your loan forgiveness opportunity. Please see below for information about how to apply for Paycheck Protection Program loan forgiveness along with additional resources to help you prepare for forgiveness.

Loan Details and Forgiveness

SBA will forgive loans if all employee retention criteria are met, and the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 60% of the forgiven amount must have been used for payroll).

Click here to read more about PPP loan forgiveness.

Frequently Asked Questions about PPP Loan Forgiveness 

  • PPP loans have an interest rate of 1%.
  • Loans issued prior to June 5 have a maturity of 2 years. Loans issued after June 5 have a maturity of 5 years.
  • Loan payments will be deferred for six months.
  • No collateral or personal guarantees are required.
  • Neither the government nor lenders will charge small businesses any fees.

Loan Forgiveness

Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease. The loan forgiveness form and instructions include several measures to reduce compliance burdens and simplify the process for borrowers, including:  

  • Options for borrowers to calculate payroll costs using an “alternative payroll covered period” that aligns with borrowers’ regular payroll cycles
  • Flexibility to include eligible payroll and non-payroll expenses paid or incurred during the 24-week period after receiving their PPP loan
  • Step-by-step instructions on how to perform the calculations required by the CARES Act to confirm eligibility for loan forgiveness
  • Borrower-friendly implementation of statutory exemptions from loan forgiveness reduction based on rehiring by June 30
  • Addition of a new exemption from the loan forgiveness reduction for borrowers who have made a good-faith, written offer to rehire workers that was declined

Click here to download the Bank of Botetourt PPP Forgiveness Checklist
Click here to download the Paycheck Protection Program 3508EZ Loan Forgiveness Application 
Click here to download the 3508 Paycheck Protection Program Loan Forgiveness Application 
Click here to download Application form 3508S for PPP loans $150,000 or less.
Click here to download Borrower's Disclosure of Certain Controlling Interests
Click here to download Interim Final Rule on Loan Forgiveness Requirements and Loan Review Procedures as Amended by Economic Aid Act

PPP Forgiveness Required Documentation

Payroll

Documentation verifying the eligible cash compensation and non-cash benefit payments from
the Covered Period or the Alternative Payroll Covered Period consisting of each of the
following:

  • Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees.
  • Tax forms (or equivalent third-party payroll service provider reports) for the periods that
    overlap with the Covered Period or the Alternative Payroll Covered Period:

    *Payroll tax filings reported, or that will be reported, to the IRS (typically, Form 941); and 

           *State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to the relevant state.

  • Payment receipts, cancelled checks, or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that the Borrower included in the forgiveness amount.

Non-payroll

Documentation verifying existence of the obligations/services prior to February 15, 2020 and eligible payments from the Covered Period. (Remember: this only applies if you included non-payroll expenses in the amount for which you are trying to seek forgiveness.)

  • Business mortgage interest payments: Copy of lender amortization schedule and receipts or cancelled checks verifying eligible payments from the Covered Period; or lender account statements from February 2020 and the months of the Covered Period through one month after the end of the Covered Period verifying interest amounts and eligible payments.
  • Business rent or lease payments: Copy of current lease agreement and receipts or cancelled checks verifying eligible payments from the Covered Period, or lessor account statements from February 2020 and from the Covered Period through one month after the end of the Covered Period verifying eligible payments.
  • Business utility payments: Copy of invoices from February 2020 and those paid during the Covered Period and receipts, cancelled checks, or account statements verifying those eligible payments.

PPP First Draw

Bank of Botetourt is no longer accepting applications for first time PPP borrowers. 

Needed Documents:

  • Copy of a valid Driver License for all signers
  • Articles of Incorporation/Organization
  • Bylaws
  • Application (link provided below)
  • Payroll information. To include third party payroll service reports, Profit and Loss Statements, and Tax Forms 941s. Submit the year used to determine loan amounts. For example, if 2019 was used to determine loan amount instead of 2020, then submit payroll information for 2019.

Eligibility:

  • Business entities, sole proprietors, independent contractors, and self-employed individuals, 501(3)c, 501©9s, tribal business, 501©6s, housing cooperatives, destination marketing organization, and news organizations.
  • General eligibility is for entities with 500 employees or fewer. Certain industries that meet SBA’s alternative size standard or SBA’s size standards for those particular industries may be eligible to apply

SBA Form 2483- First Draw Borrower Application Form:  https://www.sba.gov

SBA Form 2483-C - First Draw Borrower Application Form for Schedule C Filers Using Gross Income: https://www.sba.gov

Guidance Link: https://www.sba.gov

PPP Second Draw

Bank of Botetourt is no longer accepting applications for Second Draw PPP borrowers. 

Needed Documents:

  • Copy of a valid Driver License for all signers
  • Articles of Incorporation/Organization
  • Bylaws
  • Application (link provided below)
  • Payroll information. To include third party payroll service reports, Profit and Loss Statements, and Tax Forms 941s. Submit the year used to determine loan amounts. For example, if 2019 was used to determine loan amount instead of 2020, then submit payroll information for 2019.
  • Documentation supporting 25% reduction in gross receipts between comparable quarters in 2019 and 2020. Example, tax return information in 2019 and Profit and Loss Statements in 2020.

Targeted Eligibility - A borrower is generally eligible for a Second Draw PPP if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full loan amount only for authorized uses before the Second Draw PPP Loan is disbursed;
    Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
    SBA Form 2483-SD-C - Second Draw Borrower Application Form for Schedule C Filers Using Gross Income: https://www.sba.gov

SBA Form 2483-SD - Second Draw Borrower Application Form: http://www.sba.gov

Guidance Link: https://www.sba.gov

Available Resources:

PPP Loan Forgiveness Calculation Form
SBA’s information on Paycheck Protection Program

If you need to discuss further or speak with someone directly, please contact Bank of Botetourt at 540-591-5000, covidloan@bankofbotetourt.com or call your lender.  

Last Updated: August 3, 2021

 

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