Information on the new Recovery Loan Scheme
Thursday 22 April, 2021
On the 6th April 2021, the Recovery Loan Scheme was launched to replace the previous coronavirus business support loans – Bounce Back Loan Scheme, Coronavirus Large Business Interruption Loan Scheme, Coronavirus Business Interruption Loan Scheme and the Covid Corporate Financing Facility.
Call the Thomas Oliver financial planning team before you apply for your loan
Please note that if you intend to apply for a new recovery loan it is important to speak to a member of our financial planning team as we can assess how taking the loan will affect your mortgage. Call our Thomas Oliver mortgage broking team or speak to one of our experienced financial advisers now on 01707 872000.
The main points of the Recovery Loan Scheme are:
You can apply for a loan if your business if you are trading in the UK and you will need to show that your business:
- would be viable were it not for the pandemic
- has been adversely impacted by the pandemic
- is not in collective insolvency proceedings (unless your business is in scope of the Northern Ireland Protocol in which case different eligibility rules may apply)
Businesses that received support under the previous loan schemes are still eligible to access finance under this scheme if they meet all other eligibility criteria. Businesses from any sector can apply, except:
- banks, building societies, insurers and reinsurers
- public-sector bodies
- state-funded primary and secondary schools
Up to £10 million is available per business as follows:
- term loans or overdrafts of between £25,001 and £10 million per business
- invoice or asset finance of between £1,000 and £10 million per business
No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.
The government guarantees 80% of the finance to the lender.
The maximum length of the facility depends on the type of finance you apply for and will be:
- up to 3 years for overdrafts and invoice finance facilities
- up to 6 years for loans and asset finance facilities
The scheme is open until 31 December 2021, subject to review.
Loans are available through a network of accredited lenders.
Errol Hall, Mortgage Broker in Cricklewood, North London & Saffron Walden, Hertfordshire said:
‘The new Recovery Loan Scheme replaces the previous coronavirus business support loans, but we are still recommending that anyone who wants to apply for a new loan contacts our financial planning team on 01707 872000 for expert financial advice before taking this loan as it could affect your current mortgage or your prospects of getting a new mortgage approved. If you have any questions about how the business support loans will affect you please contact us.’