Reasons to consider a guarantor loan


When looking at the lending industry, it can often seem very intimidating, as there are several different types of loans suitable for those with varying credit scores. However, for those with bad credit, this can seem like an impossible task. To help you, we’ll explain the reasons why you should consider a guarantor loan.

What is a guarantor loan?

Guarantee loans are a type of loan taken out from someone else and are often one of the safest types of loans on the market for people with bad credit. A guarantor loan is normally taken out from a family member who is responsible for paying off the debt if you are unable to do so.

How can it provide funding to those who need it?

This style of loan works to provide those in need the opportunity to obtain alternative financing in the event of a financial emergency, even with a bad credit rating. Due to the extra level of security provided by the guarantor, you can borrow a much larger amount than payday loans and enjoy the level of security that will ensure that regular payments will be made whether it is the guarantor or the real lender. .

What do you need to be a guarantor?

To be qualified as a guarantor, you must meet the following criteria:

  • You must be over 21 years old
  • You must have a good credit history
  • You should also be as financially stable as possible

When you have fulfilled these criteria, you are then eligible to be the guarantor of a loan for a member of your family. This will allow you to have the funds you need to pay the unexpected bill or other items to ensure that your credit score is not affected at this unusual time.

Reasons to consider a guarantor loan

  • Unexpected bill payment – with many of us working paycheck after paycheck, an unexpected bill can push funds over the edge. However, with a guarantor loan, you can play off the bills as early as possible to limit the effect on your credit score.
  • Cover repairs to your car – Repairs to your car can be another financial strain that you may not be able to afford. However, a guarantor loan can help pay for these repairs as quickly as possible and get you back on the road.
  • Cover costs in case of uncertainty – If you’ve been made redundant, a guarantor loan will give you the level of security you need during this unusual time.
  • Pay for home improvements – Home renovations are a necessity that many of us cannot afford from month to month. However, a guarantor loan can provide you with the funds you need to make these home improvements with an added layer of security.
  • More security for larger purchases – When making larger purchases, you want that level of security because you have a bad credit rating. Therefore, the use of a guarantor will ensure that all payments are made easily.

With that in mind, there are several reasons why you would use a guarantor loan to make sure your finances are in order during this time of continuing uncertainty.

Keep up to date with all the ideas.
Browse the news, 1 day of email.
Subscribe to Qrius

Leave A Reply

Your email address will not be published.