Business Solutions: COVID-19 Response
COVID-19 Assistance for Business Members
We’ve worked diligently with our government partners to process and fund Paycheck Protection Program (PPP) loans on behalf of our business members—with many loans successfully funded. We’ll continue to post updates to this page as they become available.
Paycheck Protection Program Update
The Small Business Administration's Paycheck Protection Program (PPP) ended on May 31, 2021. Members who have a PPP loan may be eligible for forgiveness. If you received your loan through Navy Federal, you must apply through our digital portal. You can’t apply directly through the SBA. Details on the application process are in the FAQs below.
For PPP forgiveness-related questions, send an email to pppforgiveness@navyfederal.org and a team member will respond to you by the next business day.
PPP Loan Forgiveness
Highlights of Forgiveness Requirements
The following is a general overview. Visit the SBA PPP website for more detailed information on requirements, conditions and deadlines.
APPLYING FOR PPP LOAN FORGIVENESS
All members who received a PPP loan through Navy Federal are now eligible to apply for forgiveness through our digital portal. Please note: You’ll need to sign in using your personal credentials.
When planning your forgiveness application timeline, keep in mind that Navy Federal has up to 60 days to process your request and the SBA has up to 90 days to approve Navy Federal’s recommendation.
Please note that the timing could change if there are any new legislative amendments. If there are updates, we’ll email you and post the information on this page.
Requirements for Forgiveness
The SBA will forgive your loan if:
- the loan funds are used for eligible expenses, as defined by the SBA, incurred during the covered period
- at least 60% of the funds must have been used for eligible payroll-related expenses; up to 40% of the PPP loan may be used for other allowable costs (detailed below)
- all employees on the payroll with salary amounts of up to $100,000 as of Feb. 15, 2020 are maintained or restored at the time you apply for forgiveness
The forgiveness conditions above are subject to any change in guidance by the SBA and the U.S. Department of the Treasury. You must provide documentation for how you spent the funds to prove you've complied with the SBA's forgiveness requirements.
Payroll Costs (at least 60% of the funds)
- Salary, wages, commissions, cash tips
- Employee benefits such as vacation, parental, family, medical or sick leave
- Employer-paid state and local taxes
- Continuation of group health insurance benefits
- Group life and disability insurance
- Vacation, medical, parental, family sick leave
- Retirement benefits
Other Allowable Costs (maximum of 40% of the funds)
- Interest on mortgage obligations incurred before Feb. 15, 2020
- Rent payments on leases dated before Feb. 15, 2020
- Utility costs under service agreements dated before Feb. 15, 2020
- See the SBA website for more detailed guidance on potentially allowable costs such as certain payments for software or cloud computing services, covered property damage related to vandalism or looting during public disturbances, covered supplier costs and worker protection expenses.
Factors That Affect Forgiveness
According to the SBA and the U.S. Department of the Treasury, your forgiveness amount may be affected by the following:
- Non-Payroll-Related Costs. Your loan forgiveness will be reduced or denied if you use the loan amount for anything other than eligible payroll costs, mortgage interest, rent and utilities payments. No more than 40% of the loan can be used for non-payroll-related costs.
- Reduced Staff. Your loan forgiveness may be reduced if you decrease your full-time employee headcount. There are allowable exceptions such as employees turning down an offer to be rehired, an inability to return to Feb. 15, 2020 levels because of COVID-19 restrictions or an inability to find qualified employees.
- Payroll Reduction. Your loan forgiveness may also be reduced if you decrease salaries and wages by more than 25% for any employee who made less than $100,000 annualized in 2019. There are allowable exceptions. Please refer to the SBA website for details.
- Timeline to Rehire. For First Draw PPP loans made on or before August 8, 2020, you had until Dec. 31, 2020 to restore your full-time employment and salary levels for any changes made between Feb. 15, 2020 and April 26, 2020.