Recovery Loan - the latest new
With the uncertainty created by the latest government rulings due to the current Covid situation, it could be worth locking in some extra capital now, whilst still available.
I am sure that everyone is aware that the government have extended the Recovery Loan Scheme until 30th June 2022, albeit on different terms from what is currently available.
The main point that could effect borrowers is the government reducing its support down to 70%, this could cause lenders to be more rigid in their credit underwriting approach as they will be more at risk and it could also effect the interest rate that they charge if the risk is perceived as higher.
For larger companies this could be more time critical as the maximum loan available will drop from £10 million down to £2 million.
Loans can be used for virtually any purpose including acquisition, repaying other debts, asset purchase, bridging and general working capital.
It can also be used for repaying existing CBILS loans and transferring to more cash flow efficient terms e.g. you may have taken out a 5 year CBILS facility where the 1st year there was nothing to pay and you now have to make repayments over 4 years, we could transfer this to a 6 year RLS loan and reduce monthly outgoings. We also have another facility with a 12 month interest only option
Many businesses also like the idea of loans up to £250,000 having no personal guarantees as opposed to opting for more conventional funding, even if available.
As a whole of market broker we have access to a large panel of all the different Business Bank approved lenders so stand the best chance of an application being approved. Our service is free as the lenders pay us for putting the deals together and it costs the same whether coming through us, (utilising our expertise) or going direct.
If it isn’t possible to get an RLS loan we also have plenty of other alternatives