Updated Terms for the Paycheck Protection Program

April 6, 2020COVID-19, News

Pastors and Leaders,

On Friday we sent you information on the Paycheck Protection Program. The government has released new terms that you should review immediately. Please refer to the document below for updated terms.

In short the changes include:

UPDATED Loan Terms

  • Payments: Loan Payments will be deferred for 6 Months. However, interest will accrue over that period.
  • Interest Rate: 1%
  • Length: 2 Years
  • Payment Calculator

Forgiveness

The loan amounts can be forgiven as long as:

  • The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and
  • Employee compensation levels are maintained.

Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to the likely high subscription, it is anticipated that nor more than 25% of the forgiven amount may be for non-payroll costs.

Loan Forgiveness Requests

You can submit a request to the lender that is servicing the loan. The request will include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible mortgage, lease, and utility obligations. The lender must make a decision on the forgiveness within 60 days.

With these new terms shortening the length of the loan, thereby increasing the monthly payment, please prayerfully consider the implications that this loan may have on your church.

If you have any questions, you can email info@fmcsc.org.