Getting Guarantor Loans Even With Bad Credit
If you have never borrowed money before, it can be hard for a bank to give you the loan reason being that you do not have any credit history. Without credit history, it is hard for the bank to assess your ability to repay back the loan. As a result, the bank will place you on the high-risk category of clients.
Ideal For Poor Credit Histories
Similarly, if you have a poor credit history you will have trouble getting access to credit facilities. Lenders are increasingly more stringent in their loan allocation criteria. If you have a poor credit history or none, there is still a solution. Guarantor loans are the best solution for people in such situations.
Guarantor loans work under a very simple premise. All you have to do is get an individual with a good credit rating to act as your guarantor for the loan. You may choose absolutely anyone of your choice. There is a growth in popularity for these loans and most people ask their family members to help.
For more on credit histories and credit ratings, please visit - http://en.wikipedia.org/wiki/Credit_history
Unsecured Bad Credit Loans
Guarantor loans are unsecured loans. Unsecured loans are more expensive than the secured ones. However, the bad credit applicant will not have to worry about the credit rating with these loans. The reason is that the interest rate is determined by the good credit rating of the guarantor.
Just like obtaining any other type of loan, there are risks involved. For the guarantor, in case the borrower does not repay the loan then it is you to repay it. Borrowers must also be sure about their ability to repay the loan. The guarantor must also understand the responsibilities they have in case the borrower does not make the repayments on time.
Being an unsecured loan, it means that in case the borrower is unable to make loan repayments the creditors cannot attach the borrower’s assets to recover their money. However, the creditors may decide to go to court to make the loan secured so that they may recover the lost money. However, this is not the norm and it only happens when it is not possible to make a loan repayment agreement.
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In Conclusion
In conclusion, guarantor loans offer many benefits. They are good for helping people without a credit history gain it or those with poor credit restore theirs. In case you are looking to get a guarantor loan, it is important that both you and your guarantor understand everything before signing the contract. To get a guarantor loan is as easy as conducting an Internet search.
Please visit http://www.solution-loans.co.uk/ and check out the following video to assess the full range of benefits offered by guarantor loans
