Paycheck Protection Program (PPP) Loan Forgiveness

Details around the Paycheck Protection Program (PPP) loan forgiveness are changing constantly. More information on the terms of the PPP loan and/or the Coronavirus Aid, Relief, and Economic Security (CARES) Act may be found at and

Each individual is required to comply with the SBA’s terms and conditions.

Per the SBA website:

  • The PPP loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll)
  • PPP 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
  • 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
  • Loans approved before June 5, 2020: 2 year maturity and 1% interest
  • Loans approved on or after June 5, 2020: 5 year maturity and 1% interest

Please click here for additional details from the SBA.


Ready Capital does not offer tax or legal advice, and this information does not address all provisions of the CARES Act. Ready Capital recommends that borrowers consult their tax advisors and/or legal counsel with questions about PPP eligibility, the CARES Act, and how the borrower’s specific financial situation may impact the advisability of applying for a PPP loan or a borrower’s eligibility to qualify for forgiveness of a PPP loan.