SBA to Require PPP Loan Necessity Form From Borrowers of $2M+

Businesses and not-for-profits that received $2 million or more in Paycheck Protection Program (PPP) loans must complete one of two new loan necessity questionnaires being sent to lenders by the U.S. Small Business Administration (SBA) for distribution to borrowers.

The new forms are designed to collect supplemental information SBA loan reviewers will use in evaluating the good-faith certification borrowers made on their PPP applications that economic uncertainty made their loan request necessary to support ongoing operations.

The forms are SBA Form 3509, Paycheck Protection Program Loan Necessity Questionnaire (For-Profit Borrowers), (view PDF) and SBA Form 3510, Paycheck Protection Program Loan Necessity Questionnaire (Non-Profit Borrowers) (view PDF).

In previous guidance the SBA said that it would perform loan necessity reviews on all PPP loans to borrowers that, together with their affiliates, received $2 million or more in PPP funding. Instructions on the new forms warn borrowers that “failure to complete the form and provide the required supporting documents may result in SBA’s determination that you were ineligible for either the PPP loan, the PPP loan amount, or any forgiveness amount claimed, and SBA may seek repayment of the loan or pursue other available remedies.”