The options available to you when you are due to make your first payment after 12 months, subject to lenders discretion are:
1. If you expect to be in a better position to repay in the future
a) You could reduce your monthly repayments for six months by paying interest only.
i) This option is available up to three times during the term of your Bounce Back Loan.
b) You could pause repayments for six months.
i) This option is available once during the term of your Bounce Back Loan.
2. If you’re only able to repay a smaller amount:
You could request an extension of your loan term from six years to 10 years at the same interest rate of 2.5%.
If you’re considering this option you should think carefully about your ability to repay over a longer timeframe, taking into account such things as if you intend to cease trading or retire within the revised term of your Bounce Back Loan.
Please note for all three options that the total amount you owe will go up. This is because your interest costs increase as you’re repaying your loan over a longer period.
You can use options 1 and 2 together if you need to.