Paycheck Protection Program (PPP)

During this unprecedented time, we are here for our neighbors and small business community more than ever. We understand that the pandemic has affected all facets of life and has taken an exceptional toll on our local small businesses. As a Small Business Association approved lender, we are taking applications for the Paycheck Protection Program (PPP) on a first-come, first served basis.

The SBA has announced a Second Draw Loan as part of the Paycheck Protection Program (PPP), expanding eligibility and forgivable expenses, beginning January 15, 2021. In addition, the SBA has reopened the PPP for First Draw loans for those that did receive benefits prior to December 27, 2020.

Naveo’s participation and efforts in the PPP can be a lifeline for many of our business members and their employees: barbers and hairdressers, restaurants, contractors, auto repair shops, non-profits, churches, child care centers and many other business types who have been devastated by the economic consequences of the pandemic.

Second Draw PPP Loans

The Second Draw PPP Loan is for eligible borrowers that previously received a PPP loan. A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses.
  • Has no more than 300 employees.
  • Can demonstrate a reduction of at least a 25% in gross receipts between comparable calendar quarters in 2020 versus 2019.

The expanded list of forgivable expenses, include:

  • Software or cloud computing for business operations.
  • Certain supplier costs (Call us for details).
  • Property damage due to public disturbances in 2020, not paid by insurance.
  • Worker protection related to COVID-19, including PPE.
  • Employer-paid group premiums for health care, life, disability, vision and dental insurance.

In addition to those expenses allowed under the original PPP, the Second Draw Loan provides:

  • A more flexible Covered Period for the use of the loan funds to assure for loan forgiveness, between 8 & 24 weeks.
  • A simplified loan forgiveness process for loans up to $150,000.
  • Increased assistance for Accommodation and Food Service Businesses, like restaurants and hotels.
  • Tax deductions allowed for expenses paid with PPP loan proceeds.
  • No reduction of the amount of PPP loan forgiveness by the amount of an EIDL Advance – and restoration for borrowers whose first PPP loan forgiveness amounts were impacted by such reductions.

How to Apply for a Second Draw PPP Loan

  • Contact us by emailing sba-ppp@naveo.org or calling us at 617-702-5116.
    • If your first PPP Loan was through Naveo, we will prefill your application and return it to you via email to sign, initial and date.
      • We may request additional documentation for the 25% reduction in revenues in one quarter of 2020 as compared to the same quarter in 2019.
      • If your first PPP Loan was NOT through Naveo, we will email you an application to fill out and will request documentation related to your First Draw PPP loan.

Second Draw ApplicationSecond Draw Application for Schedule C Filers Using Gross Income

First Draw PPP Loans

First Draw PPP Loans can be used to help fund payroll costs, including benefits, as well as mortgage interest, rent, utilities, worker protection costs related to COVID-19, certain supplier costs (call us for details) and expenses for operations.

First Draw Loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:

  • Employee and compensation levels are maintained.
  • The loan proceeds are spent on payroll costs and other eligible expenses.
  • At least 60 % of the proceeds are spent on payroll costs.

How to apply for a First Draw PPP Loan

To apply:

  • Download the appropriate First Draw Paycheck Protection Program application using one of the buttons below.
  • Complete and sign the application.
    • Please include documentation of your payroll costs for 2019 (for example, IRS Forms W-3 or 941, reports from your payroll service, internal accounting ledgers for payroll; additional documentation may be requested).
    • For existing members, an electronic signature will be accepted.
    • We require a “wet” signature for new members. A high-quality scan or photo is acceptable via email.
  • Send it back to Naveo by:
    • Email: sba-ppp@naveo.org with complete application and attachments.
    • Fax: 617-702-5116.
    • Mail: Naveo Credit Union, Attn: SBA PPP Loan Coordinator, 493 Somerville Ave, Somerville, MA 02143.

Once we receive your signed application, we will contact you to discuss next steps.

First Draw ApplicationFirst Draw Application for Schedule C Filers Using Gross IncomeEmail Us

Frequently Asked Questions (FAQs)

The PPP from the US Small Business Administration has authorized up to $943 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis. All loan terms will be the same for everyone.

The loan amounts will be forgiven as long as:

  • The loan proceeds are used to cover payroll, mortgage interest, rent and utility costs, as well as certain operations, supplier, property damage and worker protection costs, over the 8- to 24-week “Covered Period” after the loan is made; and
  • Employee and compensation levels are maintained. Payroll costs are capped at $100,000 on an annualized basis for each employee.
  • No more than 40% of the forgiven amount may be for non-payroll costs.

Loan payments will be deferred until the SBA has issued its decision on forgiveness of the loan, or ten months after the end of the Covered Period if a loan forgiveness application has not yet been filed.

  • Download the appropriate First Draw Paycheck Protection Program application using one of the buttons provided above.
  • Complete and sign the application.
  • Please include documentation of your payroll costs for 2019 or 2020 (for example, IRS Forms W-3 or 941, reports from your payroll service, internal accounting ledgers for payroll)
  • Send application back to Naveo by:
    • Email: sba-ppp@naveo.org with complete application and attachments
    • Fax: 617-702-5116
    • Mail: Naveo Credit Union, Attn: SBA PPP Coordinator, 493 Somerville Ave, Somerville, MA 02143
    • Call: 617-702-5116, Naveo’s dedicated PPP Loan phone line, with questions or to get started with your application.

After we receive your complete and signed application, we will contact you to discuss next steps.

Please contact us at sba-ppp@naveo.org if you have questions regarding applying or your application status. You can also reach us by phone at 617-702-5116.

All businesses that were operating as of February 15, 2020 – including nonprofits, veterans’ organizations, Tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors – with 500 or fewer employees can apply. Additionally, housing cooperatives, as well as certain 501(c)(6), destination marketing organizations and news organizations are eligible in this round. Businesses in some industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries.

For this program, the SBA’s affiliation standards are waived for small businesses (1) in the hotel and food services industries; or (2) that are franchises in the SBA’s Franchise Directory; or (3) that receive financial assistance from small business investment companies licensed by the SBA. Additional guidance may be released as appropriate

You will need to provide Naveo with documentation for your 2019 or 2020 payroll costs – for example, IRS Form W-3 or 941, reports from your payroll service, internal accounting ledgers for payroll, bank records for payroll checks. For sole proprietorships and self-employed individuals, Schedule C of your Federal Income Tax Return for 2019 or 2020 will be required.

If employer-paid health insurance or retirement contributions are included in the payroll computation, statements must be provided that show those amounts paid.

Additional documentation will be needed to substantiate that your business was in operation as of February 15, 2020.

No. The SBA is waiving the usual requirement that you try to obtain some or all of the loan funds from other sources (i.e., the SBA is waiving the Credit Elsewhere requirement).

The program has been extended until May 31, 2021. We encourage you to apply as quickly as you can because there is a funding cap and Naveo needs time to process your loan. Naveo will not accept applications after May 24, 2021.

In order to have the loan forgiven, you must use the proceeds from the loan on:

  • Payroll costs, including benefits;
  • Interest on mortgage obligations incurred before February 15, 2020;
  • Rents under lease agreements in force before February 15, 2020;
  • Utilities for which service began before February 15, 2020;
  • Covered operations expenditures, such as business software or cloud computing service;
  • Covered property damage costs not already covered by insurance or other compensation, that was related to public disturbances in 2020;
  • Covered supplier costs (call for details);
  • Covered worker protection expenditures, such as PPE and asset renovations made to comply with government requirements related to COVID-19.

The loan proceeds must be used for allowable costs within the eight- to twenty-four-week period after the loan closes.

Non-payroll costs must not total more than 40% of the loan amount.

Payroll costs include:

  • Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee);
  • Employee benefits including costs for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care, life, disability, vision, or dental benefits including insurance premiums; and payment of any retirement benefit;
  • State and local taxes assessed on compensation; and
  • For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.

Note that payroll costs that are taken into account in determining the Employee Retention Credit are not eligible for loan forgiveness.

Yes, the PPP covers payroll costs, which include employee benefits such as costs for parental, family, medical, or sick leave.

Your PPP loan can be for up to 250% of your average monthly payroll costs from 2019 or 2020. That amount is subject to a $10 million cap. If you are a seasonal or new business, you will use different applicable time periods for your calculation. Payroll costs will be capped at $100,000 annualized for each employee.

You will owe money when your loan is due if you use the loan amount for anything other than payroll and specified non-payroll costs over the 8 to 24 weeks after getting the loan. No more than 40% of the forgiven amount may be for non-payroll costs.

You will also owe money if you do not maintain your staff and payroll.

  • Number of Staff: Your loan forgiveness will be reduced if you decrease your full-time employee headcount.
  • Level of Payroll: Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.
  • Re-Hiring: You have until the last day of your covered period to restore your full-time employment and salary levels for any reductions compared to a selected reference period from 2019 or 2020.

You can submit a loan forgiveness application to Naveo, if you obtained your PPP loan with us. The request must include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible non-payroll items. You must certify that the documents are true and that you used the forgiveness amount to keep employees and make eligible payments. Naveo must make a decision on the forgiveness within 60 days.

1.00% fixed rate.

All payments are deferred until the SBA issues a decision on loan forgiveness, or else 10 months after the end of the 8- to 24-week “Covered Period”; however, interest will continue to accrue over this period.

In 5 years.

Yes. There are no prepayment penalties or fees.

No. There is no personal guarantee requirement.

***However, if the proceeds are used for fraudulent purposes, the U.S. government will pursue criminal charges against you.***

As part of your application, you need to certify in good faith that:

  • Your business was in operation as of February 15, 2020 and has not permanently closed.
  • Current economic uncertainty makes the loan necessary to support your ongoing operations.
  • The funds will be used to retain workers and maintain payroll; or to make mortgage interest, rent, or utility payments; or covered operations, property damage, supplier, or worker protection expenditures allowed under this program.
  • Loan forgiveness will be provided for the sum of documented payroll costs and covered non-payroll costs outlined above. No more than 40% of the forgiven amount may be for non-payroll costs.
  • If required, you will provide to Naveo documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of eligible expenses for the covered period after getting this loan.
  • You have not and will not receive another loan under this program.
  • You have not been approved for a Shuttered Venue Operator (SVO) grant as of the date of your PPP application, and if you are approved for an SVO grant before the SBA approves your PPP loan, you will be ineligible to accept the loan proceeds.
  • All the information you provided in your application and in all supporting documents and forms is true and accurate. Knowingly making a false statement to get a loan under this program is punishable by law.
  • You acknowledge that Naveo will calculate the eligible loan amount using the tax documents you submitted. You affirm that the tax documents are identical to those you submitted to the IRS. And you also understand, acknowledge, and agree that the lender can share the tax information with the SBA’s authorized representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with SBA Loan Program Requirements and all SBA reviews.