NOTE: NOTE: The government has extended the deadline to apply for a Paycheck Protection Program (PPP) Loan to May 31. If you have already received a first or second PPP loan through Northwestern Bank, see our page on how to apply for forgiveness.

Paycheck Protection Program (PPP) Update

Congress has reopened the Paycheck Protection Program (PPP) to provide relief for small businesses and nonprofits during the coronavirus pandemic. At Northwestern Bank, we've already helped several Iowa organizations to secure PPP loans, and our lenders stand ready once again to help you with yours.

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Who is eligible?

Eligibility rules vary depending on whether this is your first or second PPP loan. Even if you've already received one PPP loan, your business still might be eligible for a “second draw.”

To be eligible for a first-time PPP loan:

  • You must have 500 or fewer employees.
  • Your business must have been in operation as of Feb. 15, 2020.
  • This includes nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships and independent contractors.

To be eligible for a second-time PPP loan:

  • You must have fewer than 300 employees.
  • You must have been in business prior to Feb. 15, 2020.
  • You must demonstrate that you have used or will use the full amount of your first PPP loan.
  • Your gross income must have declined by 25% or more in any quarter of 2020 compared to 2019 (this doesn't count any funds you received from PPP loans or other COVID relief programs). 

How much can you borrow?

For most borrowers, the loan amount is based on your average monthly payroll in 2019, multiplied by 2.5 times (for example, if your monthly payroll cost averaged $50,000, you could apply for $125,000).

“Accommodation businesses” like hotels, bars and restaurants are granted a special exception and may get up to 3.5 times the monthly payroll average.

The maximum for a first-time PPP loan is $10 million, while second-time PPP loans are capped at $2 million. 


How to apply for a PPP loan:

You can apply for a PPP loan through any SBA-approved institution, including Northwestern Bank. Get started by completing the steps below:

Step 1: Gather your documents. 

You will need to include supporting documents with your application, including: 

For businesses applying for a PPP loan:

  • Payroll register for calendar year 2019 or 2020
  • Form W-3 (2019 or 2020) or Form 941 Quarterly Tax Filings (2019 or 2020)
  • State Unemployment Tax Returns (2019 or 2020)

For self-employed and independent contractors:

  • IRS 1040 Schedule C or Schedule F (if sole proprietor)
  • Form 1099s, under which you were paid (if independent contractor)

For all applicants:

  • Any other documents to prove payroll expenses (e.g. employee retirement plan, vacation pay, health, life, dental & vision insurance). 

Step 2: Complete the application.

Fill out and submit the government's PPP application form by clicking the link below that applies to you.

First-time PPP app »  Second-time PPP app »

For Schedule C Filers Only:

The SBA has created a special application for self-employed / independent contractors who are Schedule C filers and wish to use “gross income” to calculate their loan amount.

First-time SCHEDULE C app »  Second-time SCHEDULE C app »

Step 3: Our bankers will be in touch.

Once you submit your application, one of our experts will reach out with more details, including the status of your application when you can expect to receive your PPP funds.

If you have any questions,  contact us online or call us at (712) 737-4911.


PPP Loans: Frequently Asked Questions (FAQs)

Here are some answers to frequently asked questions about the Paycheck Protection Program. This information changes frequently, depending on rules and clarifications made by the SBA and pending legislation in Congress. We will continue to monitor and update our website as more information becomes available.

What are the updated PPP loan terms and amounts?

  • 1% interest rate.
  • Loans issued prior to June 5 have a maturity of 2 years. Loans issued after June 5 have a maturity of 5 years.
  • 100% guaranteed by the Small Business Administration (SBA)
  • No collateral or personal guarantees required
  • No added fees (from the government or lender)
  • Up to 100% forgivable, provided funds are used for eligible expenses (more information below)

Loan amounts:

The loan amount is 2.5x your average monthly payroll, based on last year's payroll, not counting any salary amount above $100K.

  • Maximum $10 million for a first-time PPP loan
  • Maximum $2 million for a second-time PPP loan


Special increase for “accommodation” businesses:

“Accommodation businesses” — like hotels and restaurants — may get up to 3.5 times their monthly payroll average in 2019. (For example if your monthly payroll cost averaged $50,000, you could apply for $175,000). This includes any business beginning with the numbers “72”  in their NAICS code (restaurants, bars, hotels, etc.).

What else has changed in the second round of PPP?

  • Businesses in the “accommodation” industry (NAICA Code 72) are now entitled to receive loans up to 3.5x their average monthly payroll costs from the previous year.

  • Forgiveness has gotten easier: There is now a simplified, one-page application for any loan under $150,000 (and little to no supporting documentation is required).

  • Eligible loan expenses have been expanded to include payments for software, cloud computing, property damage, supplier costs and employee protective gear (more information below).

I haven't applied for forgiveness on my first PPP loan yet. Can I apply for a second?

Yes, as long as you meet eligibility requirements listed above, you can apply for a second PPP loan before applying for forgiveness for your first one. However, you must spend all proceeds from your first PPP loan prior to the disbursement of the second one.

We also recommend that you apply for forgiveness for your first loan as soon as possible, before your first payments are due (see below for details).

What can PPP loan funds be used for?

At least 60% of your loan should be used on payroll costs*, to be eligible for full forgiveness amount. Remaining funds can be used on eligible expenses including:

  • Mortgage interest and obligations (incurred before Feb. 15)
  • Rent (lease agreements in force before Feb. 15)
  • Utilities (service began before Feb. 15)
  • Other eligible expenses include worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, certain supplier costs, software upgrades and cloud computing expenses.

*What counts as payroll costs?

  • Salary, wages, commissions, or tips (capped at $100,000 annually for each employee)
  • State and local taxes assessed on compensation
  • Employee benefits (including vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments for group health care benefits including insurance premiums; and payment of any retirement benefit)
  • For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment (capped at $100,000 annually for each employee).

How long do I have to apply?

You have until May 31, 2021, to apply for a PPP loan. However, keep in mind there is a high amount of interest in this program, and limited funds available on a first-come, first-served basis — so we encourage you to apply as soon as possible.

How long will it take to receive the money?

The length of time to receive your money will depend on how quickly the government's Small Business Administration (SBA) can process applications. The SBA hasn't given us a concrete turnaround timeline for application decisions. We do know that there is currently a high volume of applications and the likelihood of a decision within 24 hours is very slim.

Once you are approved by the SBA, you will be assigned an SBA loan number. Upon receiving this number, you will receive funds within 10 calendar days (if the end of this period falls on a weekend, or federal holiday, the final day will be the next business day.)

How much of my loan will be forgiven?

A portion or all of your loan may be forgiven if at least 60% of it is used for payroll costs during the "Covered Period" after you receive the loan (see above for more information).

Keep in mind that this applies to employees who make less than $100,000 per year; wages above this threshold will not be forgiven. 

PLEASE NOTE: Forgiveness rules and guidelines, along with terms of repayment, are determined by the Small Business Administration — not the lending institution (like Northwestern Bank). As a borrower, you should understand that you may be required to pay back a portion or all of the loan your business receives.

How do I apply for forgiveness?

When is my first payment due?

Any loan amounts not forgiven will be carried forward as an ongoing loan with a 5-year term and a 1% interest rate (or a 2-year term for any loans disbursed before June 5, 2020). There will be no prepayment penalty. In addition, all payments on principal, interest and fees will be automatically deferred until 10 months after the end of your "Covered Period" or until the lender receives your forgiveness funds (whichever is earlier).

PLEASE NOTE: Forgiveness rules and guidelines, along with terms of repayment, are determined by the Small Business Administration — not the lending institution (like Northwestern Bank). As a borrower, you should understand that you may be required to pay back a portion or all of the loan your business receives.

How many loans can I take out under this program?

A maximum of two, if you meet all other eligibility requirements.


More Questions? Contact Us

Please note that the information on this page is subject to change pursuant to guidance published by the Small Business Administration. Application decisions may also be delayed by factors out of our control — like extraordinarily high volume and slow government response time. We cannot guarantee that the SBA will approve your application. In addition, approval during a previous round of the Paycheck Protection Program does not guarantee approval during the next round of the program. 

Page Last Updated: March 31, 2021.