Bounce Back Loan repayment

[Alex64]

Hi,
Looking for some advice regarding a bounce back loan. During the pandemic I made an application for a loan, approx 4k. It didnt go far and i ceased trading about 6 months after. I was a sole trader.

Im being chased by Starling Bank for repayment, which as im already in a payment plan with HMRC, i genuinely cant afford to make further repayments.

My question is whether a default on this loan could affect my personal credit score please?

Thanks,
Alex

 

[Frank Wessely]

Hi,
Looking for some advice regarding a bounce back loan. During the pandemic I made an application for a loan, approx 4k. It didnt go far and i ceased trading about 6 months after. I was a sole trader.

Im being chased by Starling Bank for repayment, which as im already in a payment plan with HMRC, i genuinely cant afford to make further repayments.

My question is whether a default on this loan could affect my personal credit score please?

Thanks,
Alex

Hi @Alex64

As a former sole trader, yes a default is likely to affect your personal credit score. If you’d had a limited company which took out the BBL your personal credit score wouldn’t have been affected.

However, I suggest that you contact Starling ASAP, explain the situation, and request the longest breathing space from repayments that they will agree to give you, and on that basis it may not qualify as a default but best check that point with the Bank. Hopefully your position will improve allowing you to make affordable repayments in the future. The important thing is to maintain dialogue with them.

Thanks.

 

[Russ Michaels]

As a sole trader you are just trading as yourself not as a separate business, so anything you do, any debts you incur are against you and your credit score us affected.

 

[Lisa Thomas]

Yes because it was a personal loan so if you default on it, your personal credit score will be affected.