The Paycheck Protection Program, which opened again this week for first time borrowers, now allows certain eligible companies that previously received a PPP loan to apply for a second draw PPP loan with the same general loan terms as their first loan.
Second draw PPP loans can be used to help fund payroll costs, including benefits. As in the first draw, funds can also be used to pay for mortgage interest, rent, and utilities, according to the Baton Rouge Area Chamber.
This second draw expands covered expenses to items like worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.
A borrower is generally eligible for a second draw PPP loan if they meet the following conditions:
• Received a first draw PPP loan and have used or will use the full amount only for authorized uses;
• Have no more than 300 employees;
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
Get more information from the Small Business Association