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Apply for a Paycheck Protection Program (PPP) Loan with MoFi

FAQs about PPP Loans in 2021

Updated 2/25/21

Can you explain the recent updates to PPP?

The Small Business Administration (SBA) is currently making some changes to the Paycheck Protection Program. This is not a third round of PPP. We will continue to update our borrowers, application process, and FAQs as we learn more.
The Biden-Harris Administration has instituted a 14-day period (02/24/21 - 03/09/21) during which only businesses with fewer than 20 employees can apply for relief through the program. The 14-day exclusive application period will allow lenders to focus on serving these smallest businesses. If your business has more than 20 employees, we still encourage you to submit your PPP application as soon as possible. We will review your application and submit it to the SBA after March 9, 2021.

Who is MoFi?

Welcome to MoFi! We’ve been working with small business owners in the Rocky Mountains for 35 years. MoFi is a nonprofit Community Development Financial Institution that provides loans to individuals, businesses, and communities outside the financial mainstream. We’re not a bank, and we make loans differently. We look beyond your financials to the stories, hard work, and planning that you’ve put into your business for years.
  • Read our 2019 annual report
  • Learn more about MoFi’s mission and history
  • Can you tell me more about MoFi’s PPP lending? Who is MoFi providing PPP loans to?

    Over the last 12 months, we have provided PPP loans for 2,000 small businesses – including sole proprietors, independent contractors, and self-employed individuals. Our average PPP loan is $25,000. Our goal is to help small businesses keep their doors open and workforces employed. We can’t wait to meet you!
    Examples of MoFi's PPP clients:
  • Preschools and childcare businesses
  • Restaurants
  • Painters, contractors, plumbers
  • Farms and ranches
  • Hair salons
  • Yoga instructors
  • Professional cleaning companies
  • Digital marketing agencies
  • Car washes and auto repair shops
  • Jewelers
  • Photographers and artists
  • Medical and dental offices, including chiropractors, physical therapists, and massage therapists
  • Veterinary offices
  • Landscaping businesses
  • Realtors
  • Guide services
  • Chambers of commerce
  • Accountants
  • Bookkeepers
  • Other professional service organizations
  • What business types are eligible for PPP?

    Businesses eligible for first- and second-time PPP loans include:
    • Sole proprietors
    • Independent contractors
    • Self-employed individuals
    • Private nonprofit organizations or 501(c)(19)s
    • Corporations
    • Veterans’ organizations
    • Tribal businesses
    • Direct marketing organizations
    • Certain nonprofits (the new bill has expanded eligible businesses to include certain 501(c)(6) nonprofit organizations)
    • Seasonal employers (those that operate no more than seven months within a year or earn no more than a third of gross receipts within a six-month period)
    • Faith-based organizations that have less than 150 employees
    • Housing cooperatives that employ less than 300 people
    • Newspapers, radio stations, and television stations
    Businesses must comply with size standards, eligibility criteria, and certain limitations.

    What payroll costs are eligible?

    • Compensation (salary, wage, commission, or similar compensation, payment of cash tip or equivalent).
    • Payment for vacation, parental, family, medical, or sick leave.
    • Allowance for dismissal or separation.
    • Payment required for the provisions of group health care benefits, including insurance premiums.
    • Payment of any retirement benefit.
    • Payment of state or local tax assessed on the compensation of employees.

    How much am I eligible to receive?

    MoFi is providing PPP loans to eligible businesses up to $250,000. If you think you will qualify for greater than $250,000, we encourage you to work with a local bank or credit union.
    First- and Second-Time PPP Loans:

    Which businesses are eligible for a first PPP loan?

  • Entities with 500 or fewer employees (full-time, part-time, or seasonal)
  • Businesses that were in operation on February 15, 2020 and remain operational
    Businesses that are not eligible for first- and second-time PPP loans include: Rental income/passive income businesses that file their taxes on a Schedule E.

    Which businesses are eligible for a second PPP loan?

    A borrower is generally eligible for a second PPP loan if the borrower:
    • Previously received a PPP loan and will use or has used the full amount only for authorized uses. (You do not have to have received forgiveness for the first PPP loan before applying for the second.)
    • Has no more than 300 employees (full-time, part-time, seasonal). (If you have multiple locations, you may not have more than 300 employees per location.)
    • Is able to demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
    Businesses that are not eligible for first- and second-time PPP loans include: Rental income/passive income businesses that file their taxes on a Schedule E.

    Can you tell me more about the 25% reduction in gross receipts?

    If you are applying for your first PPP loan, you do not need to demonstrate a reduction in gross receipts.
    To be eligible for a Second Draw PPP Loan, applicants must be able to demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020. Alternatively, applicants may compare annual gross receipts in 2020 with annual gross receipts in 2019. (If you do this, please enter “Annual” in the 2020 Quarter and Reference Quarter fields on the SBA's PPP loan application).
  • For entities not in business during the first and second quarters of 2019 but in operation during the third and fourth quarters of 2019, applicants must demonstrate that gross receipts in any quarter of 2020 were at least 25% lower than either the third or fourth quarters of 2019.
  • For entities not in business during the first, second, and third quarters of 2019 but in operation during the fourth quarter of 2019, applicants must demonstrate that gross receipts in any quarter of 2020 were at least 25% lower than the fourth quarter of 2019.
  • For entities not in business during 2019 but in operation on February 15, 2020, applicants must demonstrate that gross receipts in the second, third, or fourth quarter of 2020 were at least 25% lower than the first quarter of 2020.
  • Will my PPP loan qualify for SBA forgiveness?

    First Draw PPP Loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:
    • Employee and compensation levels are maintained;
    • The loan proceeds are spent on payroll costs and other eligible expenses; and
    • At least 60 percent of the proceeds are spent on payroll costs.
    Second Draw PPP Loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:
    • Employee and compensation levels are maintained in the same manner as required for the First Draw PPP loan;
    • The loan proceeds are spent on payroll costs and other eligible expenses; and
    • At least 60 percent of the proceeds are spent on payroll costs.

    What materials do I need to apply?

    Materials will vary based on whether you’re applying for a first or second PPP loan. Please see MoFi’s application forms for a complete list of materials needed to apply:
    • For first-time PPP clients who did not receive a PPP loan in 2020: https://formstack.io/9B9B5
    • For second-time PPP clients who received their first PPP loan from MoFi: https://formstack.io/53A50
    • For second-time PPP clients who received their first PPP loan from a different lender: https://formstack.io/0C7A3
    • NOTE: The Small Business Administration is currently making some changes to PPP. We will update these links as more information is released.

    What is the deadline to apply?

    MoFi is providing PPP loans on a first-come, first-served basis. The earlier you apply, the better. The Paycheck Protection Program is set to close on March 31, 2021.

    How long does the process take, and when will I receive funds?

    The Small Business Administration (SBA) is currently making some changes to the Paycheck Protection Program. We encourage you to submit an application, and you can expect to hear from us as soon as we receive final procedures for reviewing PPP applications.
    Once we submit your application to the SBA, approvals are subject to their timeline. The second round of PPP is being processed through a different system than the first round. One key difference is that the SBA is manually checking eligibility, and approvals are not immediate like they were during the first round of PPP. We will keep you updated on the status of your loan and provide the estimated funding date as soon as we receive SBA approval.
    Once you complete your application, we encourage you to keep an eye on your phone and email, as we will be reaching out with questions and requests for any additional information we may need. Your responsiveness will help us move your application forward as quickly as possible. Thank you in advance!

    What are the rates and terms for Second Draw PPP Loans if I do not meet the 25% revenue reduction that is required for forgiveness?

    1. The interest rate will be 1%, calculated on a non-compounding, non-adjustable basis.
    2. The term is 5 years.
    3. No collateral will be required.
    4. No personal guarantees will be required.
    THE PAYCHECK PROTECTION PROGRAM IS OPEN APPLY NOW
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