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re: SBA and PPP
Posted on 4/2/20 at 5:36 pm to Alltheway Tigers!
Posted on 4/2/20 at 5:36 pm to Alltheway Tigers!
I have a lot of clients who are being told by their Bakker to submit 1099 amounts as part of payroll costs.
It seems the bankers are pushing to increase the loan amounts as much as possible to make them points.
It seems the bankers are pushing to increase the loan amounts as much as possible to make them points.
2
Posted on 4/2/20 at 6:16 pm to Hermit Crab
Just heard the interest rate is being increased to 1%. Probably to keep some of the bigger banks that had been rumored to be backing out happy
Posted on 4/2/20 at 6:25 pm to mastersoftext
The banks we have dealt with are absolutely clueless about this process and the calculation. That ranges from local to regional to national banks. They are asking the CPA's to help them with the calculation but don't want to engage us as agents. They are about to fall on their face with this program.
Posted on 4/2/20 at 6:46 pm to BamaAlum02
It seems like tons of people are arguing over the $100K. Is it compensation then add the retirement, healthcare, etc? They contradict themselves. At this point, I am telling clients to ask the bank and if they don’t have an answer, go with the $100k comp number and add the rest.
What have you all been doing?
What have you all been doing?
Posted on 4/2/20 at 7:00 pm to Hermit Crab
quote:
There are some problems with the program that is going to keep banks from wanting to deal with this for someone who isn’t already a customer.
Banks are going to get applications from just about every single customer they already have and been swamped trying to get their clients applications through the process, approved, loan docs drawn up, and closed.
The interest rate on this is going to be 0.5%. That means that a company with 20 employees making an average of $50k is going to be able to get a loan of over $200,000, the interest on that loan over 6 months before it gets forgiven will only amount to $500. Banks are going to be losing money for each one of these they do so there is no incentive for them to reach out beyond their current customers unless they think they can bring in a prospect by helping them out.
First off, the increases it to 1%
Second of all. They can go frick themselves. It’s federally guaranteed and there sure as shite isn’t a lot of other guaranteed lending going on.
People will literally complain about anything.
Posted on 4/2/20 at 7:29 pm to Nappy
Up to $100k in compensation + SUTA + healthcare premiums paid by company + 401k contributions from company. I thought that was laid out pretty clearly in the guidance from SBA but maybe I'm wrong. It seems this thing changes hourly.
This whole thing is a cluster.
This whole thing is a cluster.
Posted on 4/2/20 at 7:35 pm to BamaAlum02
quote:
Up to $100k in compensation + SUTA + healthcare premiums paid by company + 401k contributions from company. I thought that was laid out pretty clearly in the guidance from SBA but maybe I'm wrong. It seems this thing changes hourly.
Many things have been changing as this evolves but your calculation is correct and it’s been that way since jump. 1099 contractor pay is not included. As of now.
Also, the banks don’t just make the interest. The SBA pays them a fee. Anywhere from 1 to 5% of the loan, based on the size of it. Again, as of now.
Posted on 4/2/20 at 7:37 pm to BamaAlum02
quote:
The banks we have dealt with are absolutely clueless about this process and the calculation. That ranges from local to regional to national banks. They are asking the CPA's to help them with the calculation but don't want to engage us as agents. They are about to fall on their face with this program.
With all due respect, we don’t have a clue. The treasury gets up at pressers and talks shite they can’t back up. There no way (we) banks can do what mnuchin is standing up there saying we can do.
The treasury released guidance on Tuesday night. We have to obey the rules of the Sba otherwise we are hung out to dry with no loan forgiveness, no personal guaranty and no collateral. Do you know when the Sba released our “rules to live by”? At 6:45 eastern tonight.
So before you say the bankers are about to fall on their face, cut us a little slack. We’re doing the best we can given the circumstances and the absolute colossal clusterfrick that the government has created with all this.
And to another poster, no, we aren’t trying to bump up loan amounts for the fee income. Why would we? If we can’t get the loan forgiven and/or have the Sba declare our guaranty worthless, then we are toast in the end. Immediate write off of 100% as no collateral and no guaranty.
Posted on 4/2/20 at 7:46 pm to Im4datigers
Didn't mean to offend.
We have been working these calculations for 3 straight days with little time and less guidance. More than happy to pass the baton to the bankers as I know you guys are about to be slammed processing these.
Good luck!
We have been working these calculations for 3 straight days with little time and less guidance. More than happy to pass the baton to the bankers as I know you guys are about to be slammed processing these.
Good luck!
Posted on 4/2/20 at 7:48 pm to Murray
quote:
1099 contractor pay is not included.
Independent contractors are supposed to file their own starting next Friday (the 10th). Every bank I have talked to says they will have exhausted their funds by Monday morning so good luck to those guys.
Posted on 4/2/20 at 7:48 pm to BamaAlum02
That’s what I have been doing, but now hearing other reports. I guess it’s better to go in high and get knocked down some then leave money on the table. I have been telling clients “It’s an estimate, not the exact number to expect from the bank”. Clients seem to understand so far
Posted on 4/2/20 at 7:51 pm to Nappy
My only caution would be I would hate for it to get kicked out because you did the calculation wrong and the funds are exhausted by the time you can get it updated and resubmitted.
Who the hell knows at this point?
Who the hell knows at this point?
Posted on 4/2/20 at 7:51 pm to BamaAlum02
quote:
Independent contractors are supposed to file their own starting next Friday (the 10th). Every bank I have talked to says they will have exhausted their funds by Monday morning so good luck to those guys.
Yeah, I’ve been hearing the same. I really hopes it’s just rumors about none being left because those sole prop’s really need help too.
Posted on 4/2/20 at 8:00 pm to Murray
I can’t see how funds wouldn’t run out within hours honestly. Going to be a cluster frick
Posted on 4/2/20 at 8:02 pm to BamaAlum02
Yep, but I am doing the calculation as discussed above. Who knows is right. I am going to reach out to a few bankers in the morning.
Posted on 4/2/20 at 8:24 pm to Nappy
We (bankers) really have no clue on the calculations either. Not dodging the issue or making excuses, but please believe your banker when they say what a huge giant clusterfrick this is. They’re not bullshitting you.
Posted on 4/2/20 at 8:24 pm to BamaAlum02
BamaAlum02, how quickly do you expect these funds to dry up?
I'm trying to prioritize helping clients work up the payroll cost amount.
Is the consensus seriously days?
I'm trying to prioritize helping clients work up the payroll cost amount.
Is the consensus seriously days?
Posted on 4/2/20 at 8:53 pm to Hermit Crab
As a banker I can tell you we still don’t know everything even with this supposedly starting in hours. We have received 3 different calculation templates based on guidance the sba and treasury have made since 3pm today.
Unfortunately something this massive needs a lot more planning than anyone has time for right now and there are going to be a lot of problems. Hopefully they are minimal.
Unfortunately something this massive needs a lot more planning than anyone has time for right now and there are going to be a lot of problems. Hopefully they are minimal.
Posted on 4/2/20 at 9:40 pm to Hermit Crab
Is there a specific department within the bank that will handle this? What time do they start taking apps ?
Posted on 4/2/20 at 9:43 pm to Hermit Crab
Chase's website says they dont think they will be ready tomorrow.
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