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On Friday, the United States Office of the Comptroller of the Currency (“OCC”) finalized a regulation regarding the “Permissible Interest on Loans that are Sold, Assigned, or Otherwise Transferred” by national banks and federal savings associations. Initially proposed in November 2019, the regulation provides that interest on a loan that is permissible under provisions of

On May 15, House Democrats passed on the Heroes Act, a $3 trillion package that revives, among other things, many of the severe debt collection-related restrictions House Democrats have been pushing since the start of the pandemic.  Although the Heroes Act has no promise of becoming law, the Act, combined with other federal and state

On April 30, 2020, the Federal Reserve Board announced expanded loan offerings and terms for the forthcoming Main Street Lending Program. Among other changes, Main Street is now open to larger businesses with up to 15,000 employees or $5 billion in 2019 annual revenue (previously up to 10,000 employees or $2.5 billion in 2019 annual

The Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) is now available to non-bank PPP lenders to finance Paycheck Protection Program (“PPP”) loans that they originated or purchased.  While the PPPLF was previously only available to depository institutions to finance PPP loans that they originated, the Federal Reserve revised its eligibility criteria on April 30, 2020 to provide funding to all Small Business Administration (“SBA”) approved lenders.[1]  Terms of the PPPLF are discussed in our earlier blog post.

Continue Reading PPPLF Now Open to Non-Banks and for Purchased PPP Loans

Non-bank lenders providing struggling small businesses a lifeline through forgivable Paycheck Protection Program (“PPP”) loans may soon have access to the Federal Reserve’s Paycheck Protection Program Liquidity Facility (“PPPLF”) to support their lending operations.  The Federal Reserve issued a term sheet for the PPPLF on April 9, 2020, indicating its intention to provide capital to lenders participating in the flagship small business relief program established by the Coronavirus Aid, Relief, and Economic Stability (“CARES”) Act by extending credit secured by  PPP loans on a short-term basis at favorable economic terms.[1]  The PPPLF is only available to finance PPP loans originated by the PPP lender. While the PPPLF is currently only available to depository institutions, the Federal Reserve has now announced that it is working to provide access to other PPP lenders “as soon as possible.”[2]

Continue Reading Federal Reserve Signals Progress Toward Desperately Needed Non-Bank Access to Paycheck Protection Program Liquidity Facility (PPPLF)

The SBA’s Paycheck Protection Program, a $349 billion loan guaranty program established by the CARES Act to provide deferrable, forgivable loans up to $10 million to small business owners addressed in more detail in prior Mayer Brown posts regarding the statutory provisions and the SBA’s Interim Final Rule, launched April 3, 2020. In the initial days after the program launch, hundreds of thousands of applications were submitted, but borrowers and lenders alike continued to have questions about key aspects of the program.

On April 6, 2020, the SBA clarified certain issues in new
Continue Reading SBA Issues New Official FAQs for the Paycheck Protection Program (PPP) Addressing Borrower Eligibility, Affiliation, Underwriting, and Updates to Previously Submitted Applications

The Small Business Administration (SBA) released an interim final rule the evening of April 2 outlining key provisions of the SBA’s Paycheck Protection Program (PPP) and the provisions of the CARES Act relating to loan forgiveness. The rule is effective immediately.

Some highlights of the rule include:

Increase in interest rate. The interest rate on any PPP loan will be
Continue Reading SBA Releases Guidance on PPP Small Business Loans

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law.

Among other things, the CARES Act creates the “Paycheck Protection Program,” which provides up to $349 billion to expand the Small Business Administration’s (SBA’s) existing 7(a) loan program to support new loan guarantees and subsidies. Highlights of the program include:
Continue Reading Small Business Loans under the CARES Act

A United States Magistrate Judge for the United States District Court, Western District of New York, today issued his report and recommendation on the defendants’ motion to dismiss in Petersen et al. v. Chase Card Funding, LLC et al., No. 1:19-cv-00741 (W.D.N.Y. June 6, 2019).  The Magistrate Judge recommended dismissal of both the plaintiffs’ usury and unjust enrichment claims on preemption grounds, stating that “the preemption analysis boils down to this: does the application of New York’s usury statutes to these defendants ‘prevent’ or ‘significantly interfere’ with Chase USA’s power to sell or assign the receivables generated by its credit card accounts?”.  The Magistrate Judge answered this question in the affirmative, reasoning that “since applying New York’s usury statutes to defendants would prevent Chase USA’s ability to sell or assign the receivables from its credit card accounts, they are preempted.”

Continue Reading Magistrate Judge Recommends Dismissal in Chase Issuance Trust Usury Lawsuit