SBA Adjusted monthly payments


In virtually unpublicized provisions of the CARES Act in March 2020 and the Economic Aid Act in December 2020, the Small Business Administration (SBA) was provided tools to provide debt relief assistance for their 7(a), 504, and Microloans in which the SBA will make the monthly loan payments on qualified loans for the borrowers.

Recently, the SBA released two procedural notices in February, 2021, which serve as an Adjustment Plan to the length of subsidy payments, due to the SBA determining that the $3.5 billion appropriated for this economic relief is insufficient to carry out the payments for the original length of time. In short, the SBA procedural notices will make the following monthly adjustments while all originally set limitations and guidance continue to apply.

• For newly eligible first round loans, defined as loans approved on or before September 27, 2020, and fully disbursed after September 27, 2020, the SBA will adjust the original six-month period to a three-month period.

• Second round payments for 7(a) and 504 loans approved before March 27, 2020, which were provided six-months of payment forgiveness in 2020, were to provide an additional three-months of payments. This has been reduced to two-months with a monthly limit of $9,000 per month. Additionally, for certain industries, there was an additional 5-month payment period immediately following the three-month period. However, the SBA adjusted the additional five-months of payments to a three-month period.

• Second round payments for the Community Advantage Loans and Microloans approved before March 27, 2020, will be adjusted from an 8-month period to a 5-month period.

• For borrowers with new covered loans that are approved between February 1, 2021, and September 30, 2021, the SBA will make payments up to $9,000 per month for a three-month period instead of a six-month period.

SBA subsidy payments are still currently available for new loans through September 30, 2021, while funds are available. To see if your business qualifies, contact your commercial loan lender, CPA, or the SBA (

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