House Passes Bill to Expand Loan Forgiveness Provisions of PPP Loans
By an overwhelming vote of 417-1, the House on May 28 approved legislation that would liberalize rules under the Paycheck Protection Program (PPP) to give business owners more time to have the loans forgiven by the U.S. government.
Under the PPP loan program, which passed Congress earlier this spring as part of the CARES Act, small businesses with fewer than 500 employees can take out loans equal to 2.5 times their average monthly payroll from 2019 with the total capped at $10 million. For many businesses that meet key conditions on the use of these funds, the loans may be forgiven.
The bill approved by the House, called the Paycheck Protection Program Flexibility Act, would make it easier for small businesses to utilize funds under the PPP and still qualify for loan forgiveness. Specifically, the House bill would:
- Increase the timeline for businesses to spend their loan money on payroll in order for it to be forgiven from the current eight-week deadline to 24 weeks;
- Extend the June 30 rehiring deadline for laid-off employees to Dec. 31;
- Reduce the requirement that 75% of loan money must be spent on payroll in order for the loan to be forgiven to 60%; and
- Provide more leeway on loan forgiveness for employers if they show they were unable to rehire employees or reopen to business in a way that complies with safety standards.
The Senate is working on its own version. Sen. Marco Rubio (R-Fla.), who chairs the Senate Committee on Small Business and Entrepreneurship, is seeking to extend the eight-week rehiring deadline to 16 weeks instead of the 24 weeks in the House bill. Rubio tweeted that the House bill is “good,” but expressed concerns that some provisions of the legislation could lead to “unintended consequences.”
NAHB continues to urge Congress to ensure the PPP guidelines align with congressional intent to allow more workers in the residential construction sector to access the loan program. Specifically, NAHB is urging Congress to provide a waiver from eligibility restrictions in the existing Small Business Administration 7(a) loan program to allow single-family and multifamily home builders, land developers, multifamily property owners and 501(c)(6) organizations access to the PPP.
Latest from NAHBNow
Sep 17, 2025
Housing Starts Remain Soft Ahead of Fed MeetingOverall housing starts decreased 8.5% in August to a seasonally adjusted annual rate of 1.31 million units, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
Sep 16, 2025
Tradeswomen Paving Their Own WayNAHB spoke with Professional Women in Building (PWB) members Elyse Adams and Brittney Quinn about their career paths in the trades and how PWB has positively influenced their journeys.
Latest Economic News
Sep 17, 2025
The Fed Cuts and Projects More Easing to ComeAfter a monetary policy pause that began at the start of 2025, the Federal Reserve’s monetary policy committee (FOMC) voted to reduce the short-term federal funds rate by 25 basis points at the conclusion of its September meeting. This move decreased the target federal funds rate to an upper rate of 4.25%.
Sep 17, 2025
Housing Starts Remain Soft Ahead of Fed MeetingChallenging affordability conditions continue to act as headwinds for the housing industry, but the sector could see lower interest rates in the near future with the Federal Reserve expected to cut short-term interest rates this afternoon.
Sep 16, 2025
Builder Confidence Steady but Future Sales Expectations Hit Six-Month HighBuilder sentiment levels remained unchanged in September but lower mortgage rates and expectations that the Federal Reserve will soon cut the federal funds rate led to higher future sale expectations in the coming months.