Home At Risk Due To A Bounce Back Loan?
Lose My Home Due To A Bounce Back Loan?
Are you concerned about your Home at risk due to a Bounce Back Loan? Whilst you can never say never it would be a bit of bad luck to lose your home due to a Bounce Back Loan.
Your home is not at risk simply because you are unable to pay a Bounce Back Loan. In order for your home to be lost there needs to be something more that might lead to such a situation.
Being unable to pay someone although undesirable it is not impermissible.
Is There No Risk To My Home?
The answer is that whilst there is no risk that the bank can take away your home directly if you are unable to pay the Bounce Back Loan there is still a risk. Although the bank could not obtain personal guarantees from you the inability to pay the Bounce Back Loan could result in the company Liquidation but it should not end in you going into personal Bankruptcy.
The British Business Bank that operated the Bounce Back Loan scheme said that banks were not permitted to take security for the loan over a family house.
What If I Am Unable To Pay The Bounce Back Loan?
If you are insolvent and unable to repay the Bounce Back Loan then if your company goes into Liquidation (which might be a responsible option for you to consider such as Creditors Voluntary Liquidation) then the bank will go to the government for their money. The government guaranteed all the Bounce Back Loans provided by the commercial business banks.
What It Means If I Am Unable To Pay?
The Bounce Back Loan was a mechanism to help people due to the Pandemic when companies and businesses were affected through no fault of their own. It went on for far longer than originally anticipated and therefore it is perhaps unsurprising that some people will be unable to pay it back.
What Happens If The Bounce Back Loan Is Not Paid?
If the Bounce Back Loan is not paid when it should be then the bank will inevitably highlight the failure to comply with the repayment plans and ask for payment accordingly. However, reminders from the bank will likely continue with such matters escalated through their debt collection departments to attempt to keep you on track.
Is My Home Ask If I Do Not Pay?
If you do not pay the Bounce Back Loan then your company’s credit rating will be affected as each failure to pay on time will be recorded with the credit reference agencies. The upshot of this might make it harder for the company to obtain loans and credit in the future.
Is There Any Prospect I Could Lose My Home?
Most cases where a risk to your house will be due to a Bounce Back Loan being applied for fraudulently if for example you did not have sufficient turnover at the right time when you applied fo the loan or the funds were used inappropriately ie. not for the benefit intended in the business.
In any trading situation the risk to a person’s house is not confined to a Bounce Back Loan. It can result if someone has engaged in misconduct and dishonesty that results in losses being incurred that other people may suffer.
It is therefore not impossible for insolvency litigation actions to be brought against any company Director by a Liquidator. This can in some instances mean that a Director will have to pay compensation to the company in Liquidation. However, the loss of the family home would not necessarily arise simply because you were unable to make payments required but you could be put into Bankruptcy. If you were to be made Bankrupt then that could cause you lose the family home.
So if you can’t pay a Bounce Back Loan get in touch with us for advice.
