I'm self-employed with a bounce back loan but I'm about to close?

KanePaul

I'm currently self-employed but making no money and now the minimum income floor has been re-introduced on Universal Credit this has left me no choice but to close the business and go full time employed instead.

My question though is will I still have to pay back the bounce back loan? I have no idea where to begin and Google search isn't helping!

Jeremy535897

KanePaul said:

I'm currently self-employed but making no money and now the minimum income floor has been re-introduced on Universal Credit this has left me no choice but to close the business and go full time employed instead.

My question though is will I still have to pay back the bounce back loan? I have no idea where to begin and Google search isn't helping!

Yes. It is a personal unsecured debt. They cannot force you to sell your home or primary vehicle, but otherwise they can come to you for repayment. See: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/faqs-for-small-businesses/

"What happens if I find I’m struggling to repay the loan or need flexibility to repay the loan? (Updated 5 February 2021)
On 24 September 2020, the Chancellor announced new Pay as You Grow measures for borrowers who have accessed the Bounce Back Loan Scheme. The measures will provide borrowers with the option to:

• Extend the length of the loan from six years to ten, at the same fixed interest rate of 2.5%.
• Make interest-only payments for six months, with the option to use this up to three times throughout the term of the loan
• Request a six-month repayment holiday once during the term of the loan.

Businesses will be able to use these options either individually or in combination with each other, as well as having the option to fully repay their loan early and will face no early repayment charges for doing so. These will be standardised options available to all borrowers.

Lenders will start to communicate Pay as You Grow options to Bounce Back Loan Scheme borrowers three months before repayments commence. Lenders will inform their customers directly, so borrowers should wait until they are contacted by their lender before enquiring about their options.

For more information please visit: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/pay-as-you-grow/ "

Grumpy_chap

The OP did not clarify whether they are Ltd Co. or sole-trader when describing themselves as "self-employed".  I assume sole-trader.  Regardless, the undertaking when taking out the BBLS will have included information about being liable for repayments and the Government backing only protecting lenders, not borrowers.

Jeremy535897

If it was a loan to a limited company, there is normally no recourse to the director's assets, but I detected no suggestion of this from the OP.

KanePaul

Thank you for the replies, sorry I should of said I am a sole trader not a limited company

macman

Then yes, you remain personally liable for the debt, along with any other debts of your business as a sole trader.

sheramber

loyalthomas said:

The bounce-back loan Scheme has launched and is a new scheme for businesses in the UK that are losing revenue, and seeing their cash flow disrupted.

You are  too late.

Bounce Back Scheme is closed