Bank of America Releases Information Regarding Paperwork Demands for Paycheck Protection Loans

LAGUNA NIGUEL, CA - Bank of America has given its customers a heads up on what sort of documentation they are looking for from their loan applicants. Specifically, they are asking for the follow documents:

• 2019 Payroll – total payroll for full year 2019, by employee, as reported to the IRS.
• 2019 Independent Contractor Costs – Listing of 1099’s-MISC for 2019 independent contractors, by person, as reported to the IRS. (Note: Do NOT include 1099’s for services).
• Payroll report – as of February 15, 2020, or closest date after that date, by employee.

According to Forbes, Bank of America was the first major bank to begin accepting applications for the Paycheck Protection Program loans. Unfortunately, they are limiting access to these loans to just the customers who are already borrowing from the bank. Just having a checking account with them is not enough to gain access to these loans.

"The banking industry fears they may end up holding too many low interest loans if borrowers fail to meet the SBA's standards for 100% loan forgiveness," said John Drew. "The toughest part about getting this loan may be finding a funder willing to work with you."

"In the worst case," he says, "we are advising our clients to apply for the Small Business Administration's Economic Injury Disaster Loan (EIDL) program instead."

The EIDL is more attracting to banks because of its higher interest rate of 3.75% for small businesses and 2.75% for non-profits. The best part of an EIDL program is that it includes a $10,000 advance which does not have to be repaid.

Elsewhere, we see applications are now being accepted for the Paycheck Protection Program through JPMorgan Chase’s online portal. Citigroup says their applications will be “available shortly.” Wells Fargo is not yet accepting applications either. We called a few times with no luck.

Drew & Associates is recommending that its clients have these documents ready to go as PDF files so they will be ready to upload, if and when, their bank begins accepting applications on-line. Right now, we think it maybe best to apply through the bank that holds your mortgage or other loans rather than the bank that handles your checking account.

If you have news about your bank that you would like us to share with others, please call 949-338-5921.

For more information about having the Drew & Associates team assist you with your application for a Paycheck Protection Program loan, please click on the following link, Drew & Associates' Paycheck Protection DocPrep Program.