We all saw the Paycheck Protection Program (PPP) unveiled with great fanfare last month. In short, businesses can apply through Small Business Administration (SBA)-authorized lenders for 2.5x their average monthly payroll. If they use at least 75 percent of the funds for payroll between now and June 30, the loan is forgiven. I run an integration business where cash is king and the future during a pandemic is far from certain. A program like this sounded like a great idea and I made plans to apply in early April.
I began harassing my Bank of America banker the day after the CARES act passed in March and he let me know the application process would be streamlined and out of his hands. Applying was supposed to be like applying for an auto loan, with decisioning back in a matter of hours.
What follows is an update since I last left you on April 24. Here’s Part 1 and Part 2 if you want to catch up:
Monday, April 27, 2020: The SBA opens its E-Tran online application system at 10:30 AM sharp. It promptly crashes as average activity spikes to double that of any single day during the first PPP funding wave. I get the sense a lot of businesses were left out in the cold the first time around and no one wants to miss it this time.
I find an excuse to ask my banker a question when in reality all I want is assurances that I’m OK. “Saw a blurb on Twitter saying SBA throttling banks with less than 15,000 applications in their backlog. Is your bank processing now or shut out?” I texted. “We are processing actively,” he said. I allowed a mini wave of relief to wash over me.
Later that evening I saw another text that said, “Just got confirmation Livewire’s app is in.” I’m elated that we weren’t shut out of the second round. Some of the SBA rules allowing big banks to submit large batches of applications had me really worried. It felt like the exact right move for the first round had become the worst place to be in the second round.
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Tuesday, April 28, 2020: I receive an email at 9:28 AM with the subject line, “Your SBA Paycheck Protection Program Application has been approved by the SBA.”
This was it. I finally had confirmation. My journey battling through the labyrinth was hopefully nearing its end. The email said closing documents would follow, but didn’t make any promises regarding timing. I knew the SBA required banks to fund loans within 10 calendar days, so I let my guard down a little bit.
I turned to our office manager, CFO, and accountant and asked them to make sure we spent the money in a way that would ensure forgiveness. The last thing I wanted to do was snatch defeat from the jaws of victory.
At 7:28 p.m. I received an email from Bank of America letting me know they were requesting additional documentation for our loan application. This was rich. I applied on April 3 (on the first hour of the first day of the program), and here they were — sending me the only email I’d received from them 25 days later. They sat on my application for 25 days. Wow. How do you explain something like that? I’d taken the step of deleting my loan documents from Intralinks (Bank of America’s document storage tool) when I applied with the other bank, not wanting to trigger multiple apps, so they may have been trying to process my application at that time. I can’t imagine any sane person sitting still for 25 days as they were fed a diet of deafening silence. I can only imagine how many more there are out there who received the same treatment as me.
Thursday, April 30, 2020: I pestered my banker about whether he thought funds would clear next week so we could use the payroll period to our maximum advantage. He told me he wasn’t sure, but that we were assured funding. I hated feeling this way. I don’t like anxiety and what it brings out in me. The Bank of America process made me jittery and the new bank was unfairly bearing the brunt.
Friday, May 1, 2020: I sit and stew knowing I’ll most likely be going into the weekend without any closing documents. I try to remember that all is well and will most likely turn out fine.
Monday, May 4, 2020: I draft an email to my banker expressing concern around missing the funds for this payroll, but decide not to send it because I’m now the worst of myself, acting like one of our psychotic clients.
Tuesday, May 5, 2020: I sent the email I’d been sitting on for 24 hours. Within 30 minutes I get a reply back and a Docusign link with closing documents shortly after that. Was I being rewarded for being a squeaky wheel or just coincidence? The world may never know.
I’ve never signed a set of documents so quickly. I’m pretty sure they could’ve asked for a child and one of my kidneys and I would’ve signed. A few more emails followed that let me know the loan was being sent for funding and it would be in our new account within 24 hours.
Wednesday, May 6, 2020: I woke up to this glorious email subject line: “Your SBA PPP Loan Funds have been deposited.” I logged into the bank account just to make sure. It was all there. I resist the urge to withdraw the money and stuff it inside a mattress.
The journey ends here and we’ll be transitioning into “trying like hell to qualify for PPP loan forgiveness.” I hope that doesn’t make for a good read, but something tells me it will.
If you applied, I hope your journey was less circuitous than mine. Hopefully there won’t be a Part 4!
Stay frosty, and see you in the field.