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government backed start up loans should be less than 6% interest

(9 Posts)
madhurjazz Tue 16-Aug-16 16:50:02

I get that they may have a high amount that default. But they are often given out to long term unemployed who have a buisness plan that has been check ed and been seen to be viable and a way to take them off benefits. Can only be for a small amount like a grand and such a high interest rate in comparison to the base rate makes them less likley to be successful.

8angle Wed 17-Aug-16 09:22:30

A government backed loan is a tax payer backed loan. 6% historically is an incredibly low rate for an unsecured loan of this type. If you can't make a business work paying only 6% it probably isn't going to work long term.

RandyMagnum Wed 17-Aug-16 12:17:31

I'm in full time employment and even I can't get a 6% unsecured loan, 6% is a good deal.

TheNaze73 Wed 17-Aug-16 12:36:31

It's an incredible deal. Only 6% interest rate, all the risk on the tax payer & no financial input to begin from the business owner??


Drowzeee Wed 17-Aug-16 13:14:48

YABU. 6% is a very good rate for that type of loan.

Lonecatwithkitten Wed 17-Aug-16 13:34:29

I had one paid it off 6 years early last night. It is an amazing deal as there are no early redemption penalties which a large number of commercial business loans have.
I had a business development manager who came with the loan who has been invaluable for advice and support through out the time.

madhurjazz Thu 18-Aug-16 06:50:08

Fair enough I'm bu!

I could lend the family member the money using nt mortgage, so costs 1.25%. Was going to do that but if the business fails can they just walk away from the gov money with no repercussions?

Lonecatwithkitten Thu 18-Aug-16 07:19:36

But the government money comes with support and expertise that will help them not to fail can you offer this too?

madhurjazz Thu 18-Aug-16 07:24:35

They will still get the support if they don't take the loan element.

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