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Paycheck Protection Program Loan Forgiveness

If you’ve received Paycheck Protection Program (PPP) funding through CoastHills Credit Union, you’ll need to apply to have your loan forgiveness based on strict requirements from the Small Business Administration (SBA). Loan forgiveness is not automatic. After the coverage period, which began on the disbursement date of your loan, you will need to apply for forgiveness using the applications and guidelines below. Please be sure to include all supporting documentation for your eligible expenses. 

Before getting started, check out this list of common application errors so you can avoid them.

Update on PPP Loan Forgiveness Requirements

On Thursday, October 8, 2020, the SBA in conjunction with the US Treasury, announced a simpler loan forgiveness application for PPP borrowers with loan sizes of $50,000 and less. For loans that meet the criteria, please use SBA Form 3508S – which is specifically designed to ease the forgiveness process. 

PPP borrowers of $50,000 or less are exempt from any reductions in forgiveness based on:

  • Reductions in full-time equivalent (FTE) employees; and
  • Reductions in employee salary or wages

Forgiveness Form 3508S ($50,000 and below)
Forgiveness Form Instructions 3508S ($50,000 and below)


PPP borrowers over $50,000, please use the application and instructions below:

Loan Forgiveness Application
Loan Forgiveness Application Instructions
Loan Forgiveness Application EZ
Loan Forgiveness Application EZ Instructions

For common questions about the Paycheck Protection Program Loan Forgiveness application process, click here.

Included in the application are 4 sections. Members are required to submit the Loan Forgiveness Calculation Form and Schedule A Worksheet to CoastHills in order for the application to be processed.

  • Loan Forgiveness Calculation Form
  • Schedule A
  • Schedule A Worksheet
  • Borrower Demographic Information form (optional)

For assistance with your loan application, the CoastHills Business team has put together a list of local resources from both San Luis Obispo and Santa Barbara counties which you can find, here.  

Upload Application & Documentation

Effective June 8, 2020, the covered period has been extended by the SBA from 8-weeks to 24-weeks to provide greater flexibility for Members to qualify for loan forgiveness.  Members who already received PPP loans retain the option to use an 8-week covered period.  

Other changes to loan forgiveness consideration effective June 8, 2020 include:

  • The loan forgiveness eligibility requirement that 75% of the loan amount must have been used on payroll costs during the covered period has been reduced to 60%. If less than 60% of the loan amount is used for payroll costs during the covered period, you may still be eligible for partial loan forgiveness.
  • Safe harbor from reductions in loan forgiveness based on decreases in full-time equivalent employees have been put in place for those have been unable to return to the same level of business activity you were operating at before February 15, 2020, related to worker or customer safety requirements due to COVID-19 and issued by the Secretary of Health and Human Services, Director of the Center for Disease Control and Prevention, or the Occupational Safety and Health Administration, between March 1 – December 31, 2020.
  • Safe harbor from reductions in loan forgiveness based on decreases in full-time equivalent employees have been put in place for those who are both unable to rehire individuals who were employees as of February 15, 2020 and unable to hire similarly qualified employees for unfilled positions by December 31, 2020.

Just a reminder:

  • The deposit you received is a disbursement from a loan with deferred payments for 6-months
  • During this deferment period, the loan will accrue interest at a rate of 1%
  • After the 6-month deferment period, you’ll begin making monthly payments on any balance (including any accrued interest) that is not forgiven, which will then become an 18-month term loan with an interest rate of 1%

If you have any questions about this application, please contact us at PPPLoans@CoastHills.coop. For more information on PPP Loan Forgiveness guidelines, please visit SBA.gov.