If your company doesn’t succeed and your loan hasn't been repaid yet, your Paintbrush Loan will transition to personal guarantee repayment. This means two things will happen:
First, the unpaid balance of the Paintbrush Loan will become fully due. However, the guarantor/founder will have 10 days to apply for the income-driven repayment accommodation, by uploading some documents and answering some questions using our software.
The Paintbrush Loan personal guarantee requires the founder backing the loan (acting as the personal guarantor) to pay 15% of their personal income each month to service the remaining balance of the loan (capped at $75,000 or 5 years). Repayment is paused if your personal income is less than $50,000/year. Learn more about how income-driven repayment works here.
Payments will also likely switch to coming from your personal bank account rather than your business bank account, assuming that the business account no longer has the funds to pay.