Please advise if Consumer or Business Loan

[tksnota]

Hi

I知 in the process of defaulting my loans but I had one loan that I知 confused


This fund institution is marketing itself to provide loan to be used for company not personal. So I took out this loan to be used for a company痴 capex but I want someone to tell me what kind of loan it is.

The company is Enterprise Loan Fund Ltd - T/A GC Business Finance (GCBF) http://www.businessfinance.growthco.uk/ . The loan is under my name not the company and no collateral.

[atticus]

Would you agree that your company's capex is a business purpose?

[tksnota]

Apologies please use this link - https://businessfinance.growthco.uk/

[tksnota]

What do you mean? I don稚 understand the question

I facilitated the loan for this company wherein the directors submitted their details including myself showing other streams of income plus house with mortgage.

The company is still operating but it is my own money I知 paying for the loan. But I知 having a hard time paying it

I just want to make sure that no collateral. How do I ask it from this lender?

if it became an unsecured loan then it will be treated like a personal loan without any guarantees. Is that right?

[Pezza54]

If it was a Start Up Loan it is a personal government funded and unsecured loan, maximum ｣25k and repayable over 3 years
There will be personal repercussions if you default on this type of loan.

[Pezza54]

Sorry maximum repayment period 5 years not 3 years

[tksnota]

What do you mean personal repercussions?

[tksnota]

Will it be treated like a normal personal consumer loan?

[tksnota]

The loan is split under 2 directors not with the company and one of them is with me. I知 paying the loan via my own money

[Pezza54]

Any number of directors can take out a personal start up loan in a company but the maximum is ｣25k each and ｣100k total for the business.
It sounds as if you and the other director have each taken out a personal loan, perhaps for the same amount and the same repayment term.
If you are unable to make repayments you should contact the lender before defaulting on the loan. Your credit rating could be affected and you may face court action.

[tksnota]

you are correct. Split loan between 2 directors with the same payment terms.

Is this type of loan called guarantee loan? I知 still confused about it maybe someone can explain it to me.

Will it be treated as a personal not commercial when defaulted?

[Pezza54]

A guaranteed loan is not the same as a secured loan. A secured loan is against the assets of a company meaning that the lender may seize company assets to repay the loan if the company fails to meet repayments
A guaranteed loan is where a person or persons, normally the directors agree to repay the loan from their own money if the company defaults on the loan. With this type of loan the directors may lose their personal property as well as savings.
You need to read the terms of your loan. You should be able to log in on the lender's website to do this.

[atticus]

Banks regard personal guarantees as a form of security for lending.

[tksnota]

The loan is in the names of myself and the other director all being jointly liable

These are my understanding and kindly correct me if I鋳m wrong.

1. Personal guarantee is not relevant as it is me and the other directors, who have personally taken out the loan and not the company.

2. The loan is in the name of the company but the directors personally guarantee it and are liable if the company defaults / becomes insolvent. But I知 not a director only a shareholder will it also applies to me?

3. If I default on the payments the loan co will chase all 3 named borrowers.

4. Assuming it is a not a personal guarantee will it be classified as personal loan?