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Paycheck Protection Program Second Draw

Paycheck Protection Program

Second Draw (PPP2)

Loan Information

The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP2 Loan with the same general loan terms as their First Draw PPP Loan. Second Draw PPP2 Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.
In order to serve our customers faster and more efficiently, Union State Bank has implemented an online PPP application process.  Click the link below to begin your online application:

The U.S. Small Business Administration (SBA) will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.

  • All businesses applying for a PPP2 loan must show that their business revenue declined by at least 25% in any quarter in 2020 compared to the same quarter in 2019.
  • Accommodations and Food Services companies with a NAICS code 72 can borrow up to 3.5 times the business’s average monthly payroll costs.
  • Maximum loan amount of $2 million.
  • PPP2 loans have an interest rate of 1%.
  • Loans have a maturity of 5 years.
  • Loan payments will be deferred for borrowers who apply for loan forgiveness until SBA remits the borrower's loan forgiveness amount to the lender. If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
  • No collateral or personal guarantees are required.
  • Neither the government nor lenders will charge small businesses any fees.
The above guidelines apply to many borrowers; however, there are some exceptions

A borrower is generally eligible for a Second Draw PPP2 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; and
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

Union State Bank suggests all eligible borrowers who apply for a PPP2 loan to have previously filed for loan forgiveness for their original PPP loan.

For most borrowers, the maximum loan amount of a Second Draw PPP2 Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million.

For borrowers in the Accommodation and Food Services sector, the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.
Borrowers can apply for a Second Draw PPP2 Loan until March 31, 2021, through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, eligible non-bank lender, or Farm Credit System institution that is participating in PPP. Union State Bank is proud to participate in the PPP program.

All new First Draw PPP Loans will have the same terms regardless of lender or borrower.
At least $25 billion is being set aside for Second Draw PPP2 Loans to eligible borrowers with a maximum of 10 employees or for loans of $250,000 or less to eligible borrowers in low- or moderate-income
neighborhoods. Contact your Union State Bank lender for more information.
Second Draw PPP2 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 in the same manner as required for the First Draw PPP loan;
• The loan proceeds are spent on payroll costs and other eligible expenses; and
• At least 60 percent of the proceeds are spent on payroll costs.

If you have questions regarding one of the PPP loan programs please contact your Union State Bank loan officer. For full details of the program visit:

The U.S. Small Business Administration 

U.S. Department of the Treasury

The above guidelines apply to many borrowers; however, there are some exceptions.