Bounce Back Loan

Tinaarena23

I had a catering company as a sole trader. During Covid all business ceased and after a while I took a BBL, as a sole trader (personally liable).  Earlier this year my company ceased to trade due to a few things (health being one reason), rising costs and fewer clients... I have been paying back the BBL for 2 years and informed the bank of company closure.

They then requested I pay the full amount back in one go (which isn't viable). They sent several letters saying I can extend the loan repayment date and set up a loan facility account. I started paying loan off into this account they set up.

They then sent a letter saying as my company was no longer trading they cannot accept payments and were passing this "debt" onto a collection agency. I have spoken several times with the bank saying I am willing to pay them back as I am personally liable and they said no, the collection company are dealing with it.

I have written complaint letters to bank saying if they accept that company is no longer trading, then how can they accept payment from me through a third party and also informed the bank that I will not engage with the collection company.

The collection company have phoned, texted and written to me and I have ignored all their attempts to speak with me.

The last letter I received from the collection company was that they are passing this "debt" back to the bank!

I have not yet heard back from the bank yet, but would like advise on what to do/say when they do get in touch. 

MattMattMattUK

Tinaarena23 said:

I had a catering company as a sole trader. During Covid all business ceased and after a while I took a BBL, as a sole trader (personally liable).  Earlier this year my company ceased to trade due to a few things (health being one reason), rising costs and fewer clients... I have been paying back the BBL for 2 years and informed the bank of company closure.

This might be part of the issue, you cannot close as a sole trader as you are liable as a natural person. Do you mean you closed your company bank accounts?

Tinaarena23 said:

They then requested I pay the full amount back in one go (which isn't viable). They sent several letters saying I can extend the loan repayment date and set up a loan facility account. I started paying loan off into this account they set up.

They then sent a letter saying as my company was no longer trading they cannot accept payments and were passing this "debt" onto a collection agency. I have spoken several times with the bank saying I am willing to pay them back as I am personally liable and they said no, the collection company are dealing with it.

I think the issue is the confusion of you saying you had closed, potentially closed the associated business current account etc. 

Tinaarena23 said:

I have written complaint letters to bank saying if they accept that company is no longer trading, then how can they accept payment from me through a third party and also informed the bank that I will not engage with the collection company.

You no longer trading is an irrelevance, though I suspect confusion around this has caused the issue. You can choose not to engage with the debt collection company, but that might have consequences. Are they applying any fees for normal payments? If not then it might just be the way the bank are operating with those who have ceased trading. 

Tinaarena23 said:

The collection company have phoned, texted and written to me and I have ignored all their attempts to speak with me.

The last letter I received from the collection company was that they are passing this "debt" back to the bank!

Why "debt"? It is a debt. 

Tinaarena23 said:

I have not yet heard back from the bank yet, but would like advise on what to do/say when they do get in touch. 

That will depend on what the bank do and how they view your actions. You need to wait and see what they see next. 

Tinaarena23

I closed the company bank account, as it was liable to a monthly charge.

The issue with the bank is they say - as my business is no longer trading, they cannot accept payments from me, even though the loan is personally liable and they will accept it through a third party.. .

Grumpy_chap

Tinaarena23 said:

I closed the company bank account, as it was liable to a monthly charge.

The issue with the bank is they say - as my business is no longer trading, they cannot accept payments from me, even though the loan is personally liable and they will accept it through a third party.. .

Why can't you make the payments via the third party?
If you are certain that is the process that the bank has in place (not a fraud) and there are no extra charges being imposed, does it make any difference to you whether the payment is via a third party or direct to the bank.  All that matters is that the payments are credited against your BBLS.

noitsnotme

Tinaarena23 said:

I closed the company bank account, as it was liable to a monthly charge.

The issue with the bank is they say - as my business is no longer trading, they cannot accept payments from me, even though the loan is personally liable and they will accept it through a third party.. .

You didn’t have a ‘company’ unless you were trading under a limited company.  As a sole trader you would have had a ‘business’.

As a sole trader, you and the business are the same legal entity so I’m not sure why they are saying they can’t take payments from you?

Tinaarena23

This is my complaint with the bank, the business is me, therefore,  why not take my payments! 

noitsnotme

Tinaarena23 said:

This is my complaint with the bank, the business is me, therefore,  why not take my payments! 

Well, yes, that's what I was saying.  I don't know why they can't, it does seem odd.

You should try not to say the word 'company' when you speak to the bank though.  If you're talking to a first line support type, it might be confusing the issue as they might think you're talking about a limited company.