CEBA Loan Deadline
Eligible CEBA loan holders in good standing will now have until January 18, 2024, to repay the loan (less the amount to be forgiven) to qualify for partial loan forgiveness. Repaying the balance of the loan on or before January 18, 2024 will result in loan forgiveness of up to 33 percent (up to $20,000). Failure to repay the loan by the deadline will result in forgoing this benefit.
Extended Deadline and Refinancing Option
Alternatively, if the CEBA loan holders submit a refinancing loan application with the financial institution that issued the loan, they should still qualify for the partial loan forgiveness if they repay the loan and any outstanding interest by March 28, 2024. Interest at a rate of 5% per annum will accrue starting January 19, 2024, until the repayment.
Failure to Meet either Deadline
If a business cannot meet their loan forgiveness repayment deadline, the loan will automatically convert into a three-year term loan with 5% annual interest on January 19, 2024, and must be fully paid by December 31, 2026. The partial loan forgiveness is not available.
We recommend that CEBA loan holders plan ahead to determine whether they are able to repay the loan, less the forgivable amount, by January 18, 2024. Otherwise, speak with your financial institution to consider refinancing options.
The above content is for informational purposes only and is general in nature. It is not intended to be advice. No person or entity should act upon the information above without receiving professional advice after all the facts and circumstances specific to their situation are thoroughly reviewed.