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Bounceback Loans

Bounceback Loans

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Its an ill wind sometimes and my client has three food shops that are now in boom.  He has been offered the freehold of a fourth shop and to buy it would need all accumulated cash plus £150k combined from the three separate companies which would lend to newco 4.  I cant see any restriction , although the bounceback was intended to alleviate any downside in business. A year of interest free money and then a repayment programme sounds like a good idea.  Anyone know of a reason why he shouldnt go ahead ?

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By memyself-eye
18th Sep 2020 13:45

So he has 3 X £50,000 in bounceback loans via 3 separate companies?

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Replying to memyself-eye:
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By ldcldc
18th Sep 2020 16:33

Yes. Three companies funded by three different banks.

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By Paul Crowley
18th Sep 2020 16:36

No comment on whether it is allowed
But if loans are repaid, who is going to check?

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By ldcldc
18th Sep 2020 16:45

Paul. Thanks for response. It s going to take the full six years to repay which is fairly normal. I'm just a bit concerned that some civil servant will be looking at bounceback loans and say " you shouldn't have done that " and there may be a punishment.

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Replying to ldcldc:
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By Paul Crowley
18th Sep 2020 16:49

That civil servant would be correct, but better placed looking at the use of funds by defaulters

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By bernard michael
19th Sep 2020 09:46

There is a question in the application form about whether the business has been adversely impacted by the Virus ??

How did the client reply Yes or No ??
or
Did he lie

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