Was just wondering if the loans are to the person or to the business*? (i.e. if the business goes belly-up does the entrepreneur still have to repay?)
In this case the business wouldn't have any sales and would be in the planning stage when receiving the loan, if that makes any difference
Government Startup Loans Watch
- Thread Starter
- 05-07-2014 22:20
- 06-10-2015 00:08
From what I have read, if the business goes bust, you will still need to pay back the money from the loan.
- 06-10-2015 13:53
I would say it depends...
the link here goes through the different legal structures of a business in the UK, each structure determines who is 'liable' (i.e. who pays if things don't go well), in essence, wants you get further than an 'ordinary' partnership, and start talking about 'limited liability', then you are no longer 100% responsible for the debts of the business, so to know who is responsible you would need to know how your business is structured
If you're still in the planning stage then you're in a good place to help make sure you never need to worry about that kind of thing, prove your concept and make sure that you can generate steady cash flow to keep things going, don't bet on cash you might get work things out from the resources you definitely have.
be extremely careful about this though, if you don't take reasonable care to prevent this worst case but not infrequent scenario, you could still end up in a tricky situation, this link here goes into detail on that.