BEF Group require Directors of borrowing companies to personally guarantee the loan/s. As a Director you will be asked to sign a Personal Guarantee which will form a contract between you and BEF.
Should the borrowing company be unable to make payments - whether through cash flow issues, poor trading, insolvency or any other reason - you will become responsible for repayment of the loan.
BEF will ‘make demand’ against this guarantee and you will be required to pay the balance owed to BEF either as a lump sum payment or by an agreed arrangement.
If you fail to uphold your guarantee – either because you are unwilling or unable to repay the balance owed to us – we may take legal action against you such as issuing a County Court Claim, obtaining a County Court Judgment or petitioning for your personal bankruptcy. We may enforce County Court Judgments by issuing a writ and instructing bailiffs to attend your address or by taking a charging order on any property you own.
The Guarantee document you will be asked to sign covers all lending – now and in the future – that BEF provide to your company. This means that if the current loan is repaid but a subsequent loan is then provided, this guarantee will still remain valid for that new loan and you may not be required to sign a new guarantee document.
If the borrowing company has more than one Director, you will all be required to provide a personal guarantee. Multiple guarantees give “Joint and Several liability” towards the debt. All guarantors are responsible for paying all the debt and not just a proportion or percentage of it.
We may ‘make demand’ on the guarantee when the borrowing company becomes in ‘default’ of the loan terms and conditions. If the company breaks any of the terms and conditions of the loan, including missing payments or having a winding up petition issued against it, it will be in ‘default’. We are not required to take any action against the company before we make demand on the guarantee and you become liable for the debt.
We will use the address you give us at the loan application stage to write to you in the event of default by the company. It is important that you tell us if you move home to ensure you do not miss important information relating to your personal guarantee.
One of the conditions BEF may set for the loan is the uptake by the borrower of the Enterprise Finance Guarantee (EFG). This is a scheme, supported by the UK Government, that provides security to lenders. You will be given further information about EFG should it apply to your company. (You can find out more by visiting the British Business Bank website: www.british-business-bank.co.uk)
As a partner to the EFG scheme we must explore all repayment avenues – including making demand upon and enforcing your personal guarantee – before we can claim a proportion of the money we have lost on the defaulted loan from the EFG scheme. The EFG scheme provides assurance to us, the lender, that if the loan we have provided to your company is not repaid and any security we have taken – including your personal guarantee – does not cover the money we have loaned ( and we have obtained a county court judgment and taken enforcement steps etc.) we will get a proportion of that money paid out to us under the EFG scheme.
If you have any questions about the personal guarantee you will be required to provide or the EFG scheme please contact us on 0800 080 3145 or e-mail us at email@example.com
Business & Enterprise Finance Ltd t/a Business Enterprise Fund (Co no. 1792109), Goole Development Trust (Co no. 3383475), Business & Enterprise Finance (NE) Ltd t/a BEF (North East) (Co no. 09360892), BEF-NPIF LTD (Co No. 10638308) as General Partner of the NPIF YHTV Microfinance LP, BEF BSC LTD (Co No. 11609382)
Registered Office: Devere House, Vicar Lane, Little Germany, Bradford, BD1 5AH
0800 0803145 | firstname.lastname@example.org | www.befund.org