Whether you have been approached about being a guarantor or you need a guarantor you will almost certainly have some questions about the process. On first look it might seem complicated but it’s actually very straightforward and here we’re going to give you all the information you need about being a guarantor for a loan.
In most circumstances the criteria required is very straightforward. Generally you would need to be between 18 and 75 years of age and have a good credit history. Some loan companies require that you are a homeowner but this is not always necessary. You cannot be financially dependent on the applicant so a spouse would not be acceptable. You do not need to be employed but the loan company will need you to be able to demonstrate that you are able to afford the repayments if necessary.
The role of the guarantor is to make the loan repayments if the borrower is unable. However, this is usually a ‘worst case scenario’ and steps would be taken in the first instance to try to ensure the payments can be fulfilled by the borrower. Nevertheless, it is important that it is understood that the guarantor may be expected to clear a debt of perhaps up to £7500. If you have been asked it is reasonable to expect the borrower to give you a breakdown of their income to demonstrate they are able to afford the repayments without stretching themselves financially. Being a guarantor is a serious undertaking and will have an impact on your relationship with the friend or family member involved. In most cases the borrower is more than aware of this and is much less likely to default on payments as a result; no one wants to ruin a good friendship.
If the worst happens and you are required to make some repayments or clear the loan itself this will not affect your credit rating so long as you do not default on the payment. The loan company will advise you as soon as possible if a payment has been missed.
We cannot find you a guarantor, will need to find the appropriate person yourself but what we have hopefully done is give your chosen guarantor information they need in order to make their decision.
To find out how much you could borrow all you need to do is fill in our quick form and we will have offers back to you in minutes.
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