The PPP Flexibility Act, effective June 5, adds some updates to the existing program
These changes include:
Lowering required percentage of loan spent on payroll costs from 75% to 60%.
All loans after June 5 will have a five year maturity. Loans before June 5 will still be due in two years, but lenders may consider extending that period.
All borrowers will have a 24 week "covered period" to use the loan amount. Borrowers before June 5 have a choice of 8 or 24 week "covered period".
Borrowers will have a deferral period of 10 months from the end of the covered period before payments come due. If the borrower submits a forgiveness application within the 10 month period, payments may continue to be deferred until the SBA decision to approve or deny the application.