Fannie Mae Student Loan Forgiveness

Fannie Mae Student Loan Forgiveness

The U.S. Small Business Administration has released a 1-page form that makes it easier to apply for the cancellation of Paycheck Protection Program loans. It also includes newly revised forms that comply with the latest stimulus legislation. 

Congress approved the COVID-19 relief plan last month, which included $284 billion of financing to small businesses that needed loans. The funds were used to reduce the economic burden of the coronavirus epidemic. It included a requirement for the SBA to issue simplified forms within 24 days of the legislation being adopted to make the process of applying for forgiveness. It also included conditions designed to facilitate more loans from community banks, specifically for minority-owned businesses that struggled to get loans last year.

Fannie Mae Student Loan Forgiveness

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, said that the Small Business Administration fulfilled the requirement to issue the PPP form, which is one page long, for loan forgiveness within 24 hours from the date of enactment under the Consolidated Appropriations Act, 20,21. This was published on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also released additional updated forms.”

First Draw PPP Conditions for loan forgiveness

Fannie Mae Student Loan Forgiveness – First Draw PPP loans given to eligible borrowers qualify for total loan forgiveness within the 8 to 24-week period after loan disbursement:

  • Employee and compensation levels are ensured
  • The loan proceeds are spent on payroll and other expenses that are eligible and
  • A minimum of 60% of the proceeds are used to pay for payroll expenses

Second Draw PPP Loan Forgiveness Terms

Second Draw PPP loans for eligible customers are eligible for loan forgiveness when the loan is repaid within an 8to 24 week time frame.

  • The levels of compensation and employee pay are kept in the same way as is required for the First Draw PPP loan
  • The loan funds are used on payroll as well as other eligible expenses and
  • A minimum of 60% of profits are used to pay for payroll expenses
  • How do I apply for loan forgiveness , and the time to apply

Once all of the loan funds have been utilized, a borrower can apply to be forgiven. Borrowers can request forgiveness at any point up to the date at which the loan matures. If they do not file for forgiveness within 10 months after the date of expiration of the period covered and the loan is not renewed, PPP loans are not deferred any longer, and borrowers must make monthly payments to their PPP lender.

Download Fannie Mae Student Loan Forgiveness

Gallery of Fannie Mae Student Loan Forgiveness


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