Loan With a Guarantor
Should you expect to pay more for a loan with a guarantor?
A guarantor loan is one option that people have when they can't get the credit they need themselves to take care of something financially. A person can need a guarantor for many different types of loans, but one industry that stands out is the short-term loan market for people with bad credit. Without a guarantor and with bad credit, you might have to settle for a payday instalment loan that will gouge you with interest charges.
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Finding More Affordable Interest Rates
With a guarantor, you can get a better interest rate and borrow even more money. Have you made sure that there isn't a way for you to get a loan like this on your own? You might be surprised if it's been awhile since you looked around. Of course, if you're comfortable with getting a guarantor for the type of loan you need, then that sounds like a plan, too. At least you don't have to come up with the collateral, right?
Always Make Repayments On Time
Did you know that if you were to default on the loan payments, it's not just you that can be sued in court by the loan company? The loan company can also sue your guarantor, and then your guarantor can turn around and sue you as well. To avoid the suing party, what you're going to have to do is hold up to your end of the bargain. You plan to do that of course, and now you just need someone that takes you for your word and can have your back.
Top Tip - Some people are now actually missing repayments on purpose. To find out why, check out the following link - https://www.telegraph.co.uk/finance/personalfinance/borrowing/loans/10019099/Borrowers-deliberately-miss-loan-payments.html
Helping You Out of a Tricky Situation
You might not have even been thinking about needing a guarantor until you found yourself in that position. Sometimes people get told that by companies, and then they are stuck scrambling to find someone to fulfil that obligation. Instead of having to handle things this way, start working on finding your guarantor now. Always know what your credit report says, and if you think a guarantor is going to be required, be prepared.
A Common Type of Loan
Guarantors for loans used to be much more common in years past, but they are still quite prevalent today as well. Your guarantor isn't just signing for your loan. He or she is going to have to provide financial documents and submit to a credit check. Be sure you brief your guarantor so that he or she is ready for the application process with you, and then it's time to apply.