Paycheck Protection Program Flexibility Act

Introduction

On June 5, 2020, the Paycheck Protection Program (PPP) Flexibility Act (H.R. 7010) was enacted. The law gives employers more time and flexibility to use their PPP loans while still receiving loan forgiveness, a chief highlight of the program. The law makes the following key changes to the PPP:

Extension of Maturity Date

• The law extends the maturity of the unforgiven portion of a PPP loan to a minimum of five years. The SBA had originally set loan maturity at two years.
• This provision applies to PPP loans made on or after the date the law was enacted, provided that borrowers and lenders of PPP loans made prior to such date may mutually agree to extend the maturity date, presumably without adversely impacting loan forgiveness or the availability of the SBA guarantee.