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Paycheck Protection Program

Updated April 24, 2020

The federal government has approved additional funding for the Paycheck Protection Program, so Farm Credit Mid-America now is accepting online applications for the guaranteed loan program from customers. The service is in keeping with our commitment to work alongside you to support your needs and operations.

The PPP is part of the Coronavirus Aid, Relief and Economic Security (CARES) Act, which initially authorized up to $349 billion in economic relief to small businesses nationwide, providing a direct incentive to keep workers on the payroll and meet other critical expense needs. Those funds were expended by April 16, so Congress moved to re-fund the PPP.

Funds for the forgivable loan program come through Small Business Administration (SBA) guarantees for loans issued by approved lenders.

Loans can be used to cover payroll costs, including benefits as well as rent, utilities and interest on mortgages. The amount eligible for forgiveness is tied to costs actually incurred and paid during the 8-week period beginning on the date of disbursement of a PPP loan. At least 75% of the amount eligible for forgiveness must be attributable to payroll costs.

Allocated funding for the PPP is expected to be expended very quickly due to demand. Accordingly, Farm Credit Mid-America does not guarantee that completed applications will receive approval from SBA or be allocated funds for a SBA lender guarantee under the PPP.

We are able to accept applications only from existing customers and entities of Farm Credit Mid-America/Rural 1st® in which the principal owner of any entity also has Gross Farm Income of at least $500. Applications will only be accepted online.

Eligibility

Farm Credit Mid-America is accepting applications from applicants in its chartered territories of Indiana, Kentucky, Ohio, and Tennessee who have an existing loan with Farm Credit Mid-America or Rural 1st®, a tradename and registered trademark utilized for Farm Credit Mid-America’s rural home lending activities. Customers with existing loans have established their account with us, satisfied underwriting verifications, and established their eligibility to borrow under regulations applicable to the Farm Credit System, which allows Farm Credit Mid-America to help provide efficient access to available relief funds and to help prevent fraud in the process. Individual applicants must be able to generate at least $500.00 in Gross Farm Income in order to qualify. All loans are subject to credit approval and eligibility requirements.

The PPP is designed for businesses with 500 or fewer employees whose principal place of residence is in the United States.

Sole proprietorships, independent contractors and self-employed people are also eligible in addition to nonprofits, veterans' organizations and Tribal business concerns.

Loan details and forgiveness

Borrowers can access a loan for up to 2.5 times their average monthly payroll costs not to exceed $10 million. Covered payroll expenses include salary, wages and cash tips up to an annual rate of $100,000 per employee plus health insurance, retirement contributions and covered leave.

Loans have a maturity of 2 years and an interest rate of 1 percent.

No collateral or personal guarantees are required.

No fees will be charged by the SBA or lenders.

The amount eligible for forgiveness is the amount of costs actually incurred and paid during the 8-week period beginning on the date of disbursement of a PPP loan. At least 75% of the amount eligible for forgiveness must be attributable to payroll costs.

Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines or if salaries and wages decrease.

For full details, see the SBA’s Reference Guide for Applicants and Lenders.

For details on calculating the loan amount, see the Treasury’s Guide to Calculate Loan Amount.

Documentation to support an application

Review the PPP borrower application form (this is a read-only version, not an actual submission document), to see the information that will be requested when applying.

Applicants should be prepared to upload:

  • Documentation that demonstrates they had employees for whom they paid salaries and payroll taxes on February 15, 2020.
  • Payroll documentation confirming the amount of average monthly payroll costs for calendar year 2019.
  • Applicants must provide documentation to the lender supporting how the loan amount was calculated in accordance with the PPP Rule and the CARES Act.

Sole proprietors and self-employed individuals must submit documentation to establish eligibility, such as payroll processor records, payroll tax filings, or Form 1099-MISC, or income and expenses from a sole proprietorship. For borrowers that do not have any such documentation, the borrower must provide other supporting documentation, such as bank records, sufficient to demonstrate the qualifying payroll amount.

How do I apply?

Answer a few questions to see if applying through Farm Credit Mid-America is the right choice for you.

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Where can I learn more?

Loans are subject to applicable Small Business Administration requirements, which are subject to change without notice. Loan program availability is limited.

The information on this page is being provided for informational purposes only and may not be relied upon and does not bind Farm Credit Mid-America to the terms expressed above. All information is subject to change and prospective applicants are encouraged to refer to the publications about the PPP from the Department of Treasury and the Small Business Administration for the most recent and accurate information. Farm Credit Mid-America does not provide Legal, Tax, or other professional advice and the foregoing shall not be construed as such. Prospective applicants should consult with their professional advisors to determine if they are eligible for loans under the PPP and if obtaining a loan under the program is right for them.