Will I have to provide a Personal Guarantee or my home as security?
No personal guarantees or security will be required.
What happens in the first 12 months of my loan repayments?
You will receive a payment holiday for the first year of your loan, with the interest being paid for by the Government, via a Business Interruption Payment.
After the first 12 months, you will need to start making monthly repayments to repay the amount you borrowed, plus interest from the date your repayment holiday ends.
We will send you a repayment schedule outlining your options, around three months before your first payment is due. You do not need to contact us in advance.
What happens if I can’t make the payment on the loan after 12 months?
If you’re concerned that you can’t meet the repayments on your loan after 12 months, then please call the Coronavirus Customer Support Line as soon as possible on 08000 121 614 (we’re open 8am-6pm, Monday to Friday).
We’ll assess your situation and discuss your options.
What happens if I no longer need my Bounce Back Loan?
If you no longer need the loan, you can choose to pay it back early. You’ll then pay less interest. There are no early repayment charges and you won’t pay any interest if you pay the full amount before the end of your initial 12-month repayment holiday.
Or you can make a one-off repayment, as well as additional payments on a regular basis, and doing so will also help save you money on your interest payments.
What other repayment options are available to me?
The Government has announced Pay As You Grow options for Bounce Back Loan borrowers to help businesses get back to regular trading. Pay As You Grow could give you more time and flexibility to pay back your loan.
Pay As You Grow options will be available to you once you start to repay your Bounce Back Loan, from 12 months after it was first approved.
Using these options won’t affect your credit score, though it may influence how we assess your creditworthiness in the future and your loan may cost you more overall.
The options available to you when you are due to make your first payment after 12 months are as follows:
- If you expect to be in a better position to repay in the future:
You could reduce your monthly repayments for six months by paying interest only. This option is available up to three times during the term of your Bounce Back Loan.
You could take a payment holiday for six months. This option is available once during the term of your Bounce Back Loan.
- If you’re only able to repay a smaller amount:
You could request an extension of your loan term from six years to 10 years at the same interest rate of 2.5%.
If you’re considering this option you should think carefully about your ability to repay over a longer timeframe, taking into account such things as if you intend to cease trading or retire within the revised term of your Bounce Back Loan.
Please note for all three options that the total amount you owe will go up. This is because your interest costs increase as you’re repaying your loan over a longer period.
You can use options 1 and 2 together if you need to.
What are the Bounce Back Loan terms and conditions?
When you applied for your Bounce Back Loan, you declared that you understood that:
- You are fully liable for all repayments, and if you are unable to meet these obligations, this could negatively affect your credit score.
- The 100% government guarantee is provided to cover any losses the lender makes and does not cover any losses that you might suffer if you are unable to meet your payment obligations.
- We would not carry out any affordability checks on your application.
The full set of declarations you made will be on your Bounce Back Loan application form. Additional terms and conditions you agreed to are detailed in your facility letter.
Do I need to use the same bank account to make my repayments that I used to apply for the Bounce Back Loan?
No – you don't need to use the same bank account that you used to apply for your Bounce Back Loan to make repayments. You can use another HSBC bank account, or a bank account at another bank (in each case, subject to usual transaction checks).
What happens if I find I'm struggling to repay my Bounce Back loan or need flexibility to repay?
On 24 September 2020, the Chancellor announced new Pay as You Grow measures for borrowers who've accessed the Bounce Back Loan Scheme (BBLS). The measures will give you the option to:
- Extend the length of your loan from six years to ten years
- Make interest-only payments for six months, with the option to use this up to three times throughout the loan
- Request a six-month repayment holiday
You'll be able to use these options individually or in combination with each other, as well as having the option to fully repay your loan early with no early repayment charges. These standardised options will be communicated to all borrowers 3 months before repayments start. If you already have a BBLS with us, we'll send you a communication soon, with details of the various options.