I Need a Guarantor For a Loan

What To Do If I Need a Guarantor For a Loan?

If you need to have a small amount of money to use for bills that you cannot pay, you may need to contact a bank to get a loan. The problem with working directly with typical lending institutions is that unsecured loans are not that easy to acquire. They like to have some form of collateral which will serve as an insurance policy of sorts, allowing them to feel comfortable about providing someone with money. 

Banks will lend money for people that are purchasing a home, or a car, but in unsecured loan for cash

is one of the most difficult that you can acquire. Instead, you should consider working with companies that offer guarantor loans, those that provide cash for people every day. These companies are easy to find, and as long as you have a willing participant, you can easily get the money that you need.

Important Note - Does a guarantor for a loan make the loan cheaper? Find out more by reading on.

What Is A Guarantor?

If you find yourself asking do I need a guarantor for a loan, it is obviously fairly important to understand what a guarantor actually is!

A guarantor is an individual that is able to co-sign with the person that would like to borrow the money. These individuals typically have very good credit, sometimes own a home, and they also have a willingness to be responsible for the debt if the borrower cannot make the payments. They are actually responsible for repaying the loan entirely, plus interest, if the other person goes into default. However, a person that needs to get a loan quickly can often find a guarantor that will work with them, allowing them to acquire this unsecured loan.

Find out more about how you can be a ‘friend in deed’ in the following article - http://www.independent.co.uk/money/spend-save/consumer-rights-a-guarantor-can-be-a-friend-indeed-if-you-can-t-get-credit-8831778.html

How This Can Backfire

If you are a person that would not mind being a guarantor for a friend or family member, you need to consider the risks. There is always the possibility that this person may not pay the loan back, something that you may be able to predict based upon prior habits that they have had. If you decide to do this, and the paperwork goes through, the loan that they receive is also essentially yours. Keep this in mind if you are thinking about helping someone that you know by becoming a guarantor.

What Is The Repayment Schedule?

The repayment schedule will either be monthly payments that will last for several months or years, or it may be due and payable all at once. Typical payday loans, for instance, are provided to people on a very short-term basis, requiring that the loan be paid off in full in less than a month. Regardless of the type of loan that the other person receives, they must adhere to the repayment schedule. If they do not, this could actually compromise the credit of the guarantor, which is why it is so important to know the repayment schedule before the papers are signed.

If you have a poor credit score, the following video offers 5 excellent ways to improve it.

After the borrower receives the money, and everything has been paid off, this will allow the guarantor to be free of their obligations. This is usually how it works, although there is always the possibility that a good deed may result in a compromising financial situation. You can find companies that will require a guarantor to provide loans very easily by searching on the web, or looking for them in the local business directory. These companies are designed to help anyone that is in need of short-term cash, and will be very willing to do this as long as there is a guarantor that will sign along with them.