In the aftermath of the pandemic, securing financial assistance through the Regional Relief and Recovery Fund (RRRF) has been a lifeline for many businesses and individuals. As the repayment date is nearing, we wanted to ensure businesses have all the information they need to successfully repay their loan and benefit from the loan forgiveness program.
Read the steps below to guide you through repaying your loan;
STEP ONE: Understand your terms.
Before tackling the repayment process, let’s dissect the terms of your RRRF loan. It’s always important to understand the terms and conditions of your loan.
Interest Rates: Familiarize yourself with the interest rates attached to your loan. Starting January 19th, any unpaid loans will be converted into installment loans with a 5% interest rate, amortized over 36 months.
Repayment Period: Understand the duration within which you are expected to repay the loan. All loans must be fully repaid by December 31, 2026.
Understanding the consequences of non-repayment is crucial for avoiding potential pitfalls:
Accrued Interest: Failing to meet your repayment obligations may result in accrued interest. Be aware of the compounding effect, as unpaid interest could significantly increase the overall amount owed.
Credit Implications: Non-repayment can negatively impact your credit score. This, in turn, may affect your ability to secure future loans or credit on favorable terms.
STEP TWO: Make your plans and communicate.
If you’re unable to repay your loan by January 18th, 2024, get in touch with your financial institution for refinancing options.
Maintaining open lines of communication with your lending institution is pivotal:
Proactive Discussions: If you anticipate challenges in making payments, engage with your lenders proactively. They may offer alternative arrangements to assist you during difficult times.
STEP THREE: Make the Deadline
As you navigate your repayment journey, it's crucial to be mindful of a key detail: forgiveness applies only if the full amount is repaid by January 18th. This means that to benefit from any potential loan forgiveness, your repayment must be completed by this date.
Successfully navigating the repayment process of your RRRF loan demands a comprehensive understanding of the terms, diligent financial planning, and open communication with your lenders. Starting January 19th, any unpaid loans will be converted into installment loans with a 5% interest rate, amortized over 36 months. The option for loan forgiveness will no longer be available after January 18th. By adhering to the rules, staying informed, and taking proactive steps, you pave the way for financial stability and growth.
Need Assistance or Have Questions?
If you have any questions or need assistance, don't hesitate to contact us at 604-885-1959.