My PPP Loan Forgiveness Application was Denied – Now what?

Last May, the Paycheck Protection Program (“PPP”) closed to new PPP loan applications, and the next phase of the PPP – loan forgiveness – began picking up steam. PPP loan borrowers have ten months from the end of their loans’ “covered period” (or period to use the loan proceeds for authorized purposes) to apply for loan forgiveness. After that, depending on whether a lender is participating in the United States Small Business Administration’s (“SBA”) direct loan forgiveness application, borrowers might be able to apply for forgiveness directly with the SBA.  According to the SBA, more than a million forgiveness applications had been submitted directly to the SBA through their loan forgiveness portal by the beginning of last fall. If borrowers cannot apply directly through the SBA, they will have to apply through their respective PPP lenders.  

If the SBA issues a written decision denying the borrower’s forgiveness application, the PPP borrower needs to understand the appeals process and be ready to act quickly. 

What kind of PPP loan forgiveness decision can you appeal?

A borrower may only appeal, to the SBA’s Office of Hearings and Appeals, an official written decision by the SBA, after SBA completes a review of a PPP loan that finds a borrower:

  1. Was ineligible for a PPP loan; 
  2. Was ineligible for the PPP loan amount received or used the PPP loan proceeds for unauthorized uses; 
  3. Is ineligible for PPP loan forgiveness in the amount determined by the lender in its full approval or partial approval decision issued to SBA (except for the deduction of any Economic Injury Disaster Loan advance in accordance with section 1110(e)(6) of the CARES Act); and/or
  4. Is ineligible for PPP loan forgiveness in any amount when the lender has issued a full denial decision to SBA.

Additionally, a borrower cannot appeal a lender’s decision denying forgiveness; but the borrower has other possible remedies if presented with just a decision from the lender. 

How long do you have to appeal a decision?

A borrower must file an appeal petition within 30 calendar days after (i) the borrower’s receipt of the final SBA loan review decision or (ii) notification by the lender of the final SBA loan review decision, whichever is earlier. 

It is critical to timely file the appeal petition because the PPP rules require the dismissal of any appeal that is untimely.

Can my accountant, that helped me with my loan forgiveness application, submit my appeal?

Only the borrower or the borrower’s attorney can submit a PPP loan appeal through the SBA’s PPP loan forgiveness appeal portal. If the borrower is a separate business entity, the following individuals (or the entity’s attorney) may submit appeals:

  • If the borrower is a corporation, trust, or association, officers of the borrower
  • If the borrower is a limited liability company, members of a borrower
  • If the borrower is a partnership, a partner of the borrower

How can you file a loan forgiveness appeal petition?

The SBA has set up a special PPP loan forgiveness appeals portal at Small Business Administration OHA Appeals Platform (  The appeal petition must comply with very specific requirements for its contents to ensure that it is not dismissed. Based on the timelines provided by the rules of practice for PPP appeals and guidance from the SBA, it may take approximately three months for OHA to complete its review and issue an initial decision on the appeal. A borrower can take additional appellate steps if the borrower receives a decision affirming the denial of loan forgiveness that may extend this process for months or even years.

What can you do?

If you believe you have a basis to appeal a final loan review decision issued by the SBA, you must act quickly. If you fail to timely file an appeal or if you file an appeal without all of the required contents, your appeal may be dismissed, and you will have to repay your loan in full. 

Take Action

If you have questions or concerns regarding filing a Paycheck Protection Program loan forgiveness appeal or other problems with PPP loan forgiveness, please contact Matthew M. Zapala, Esq., by e-mail ( or phone (518.432.3133) for a no-cost consultation to see how Nolan Heller Kauffman LLP may be able to assist you.

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