MCMANUS HALL
  • Services
    • Limited Company Accounts
    • Taxation Services
    • Self Assessment
    • CIS
    • Registered Charities
    • Xero
    • Growth Management
    • Payroll Services
    • Bookkeeping and VAT
    • Business Consultancy
    • Company Secretarial
  • Cloud Software
  • News
  • Pricing
  • Contact
  • Meet the Team
  • Vacancies
  • Login
Latest News

Bounce back repayments begin

7/20/2021

 
The bounce back loan scheme (BBLS) has kept many businesses afloat over the past year, but, with the first repayments now starting to become due, many of the 1.5 million businesses that borrowed money could fall into difficulty.

Default position

The BBLS was launched in May 2020, with no interest charged or repayments required for the first twelve months. Bounce back loans are repayable over five years, so 1/60th of the capital is repaid each month, plus the interest accrued for that month, at a fixed annual interest rate of 2.5%. Repayments will therefore reduce over the term of loan as capital is repaid. The first repayment on a £20,000 loan, for example, will be £375.00 (£333.33 capital plus £41.67 interest).
Although loans are guaranteed by the government, banks will be under pressure to recover cash without triggering guarantees. However, since lenders were not permitted to require personal guarantees, even unincorporated businesses are not at risk of having their home or car seized.

Managing repayment

There are various measures that you can take if repaying a BBL is going to cause difficulty:
  • The term of the loan can be extended to ten years so that capital repayments are reduced.
  • You can move to interest-only repayments for a period of up to six months (this option can be used three times).
  • You can pause repayments altogether for a period of up to six months (this option can only be used once).
  • Consider topping up your finances under the recovery loan scheme launched in April, although your existing BBL will be taken into account and you must be able to afford the additional debt.
Your BBL lender will inform you of the first three measures, known as pay as you grow. They will all result in more interest being paid overall.

Picture

Comments are closed.

    ​Archives

    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    February 2020
    January 2020
    November 2019
    October 2019

Head Office - Gateshead
C11 Marquis Ct
Team Valley
Gateshead
​NE11 0RU
Cobalt Office - Newcastle
Cobalt Business Park
Silver Fox Way
Newcastle upon Tyne
​NE27 0QJ


Tel: 0191 4877601 (Gateshead)
Tel: 0191 6919700 (Newcastle)

e-mail: info@mcmanushall.co.uk
Picture
© 2021 All rights reserved. McManus Hall Ltd is a Limited Company, Registered Number 08191795.
Photos used under Creative Commons from Homedust, Patrick Cannon Tax Barrister, Brett Jordan, wuestenigel, raisin_raisin, Jirka Matousek
  • Services
    • Limited Company Accounts
    • Taxation Services
    • Self Assessment
    • CIS
    • Registered Charities
    • Xero
    • Growth Management
    • Payroll Services
    • Bookkeeping and VAT
    • Business Consultancy
    • Company Secretarial
  • Cloud Software
  • News
  • Pricing
  • Contact
  • Meet the Team
  • Vacancies
  • Login