You Too Can Have Enough Credit With Guarantor Loans

Credit, without it you can't really do a lot in the world

. You need good credit ratings in order to purchase cars, houses or other household items like sofas, kitchens and much more. Unfortunately this all involves you to cooperate with the banks terms and conditions, which is where some clients fall short. Missed payments and the failure to complete the entire term of the contract leads to the client's credit history being tarnished.

When this happens it becomes increasingly hard for people to obtain the credit necessary to purchase the items described above and many more. Thankfully there is a solution available to these people and that is guarantor loans. So what are guarantor loans?

Guarantor loans are basically a way that the banks and authorised financial agencies will lend the necessary credit to these black listed individuals. The reason that these banks and financial agencies will lend the money to the individuals with bad credit is basically because a guarantor has to agree to sign up to the deal to cover the payments should the holder default on the loan or miss payments, hence the name guarantor loans.

There are several stipulations that the banks and other financial agencies place on individuals when they apply for a guarantor loan. Firstly and probably most obviously the person who is going to be the guarantor on the loan needs to have a good credit history. Banks perform thorough checks on individuals before releasing any funds, so it is no good if you are hoping to pull the wool over the financial agencies eyes.

Other factors that you will need to apply with when applying for a guarantor loan include the guarantor being between the ages of 25 and 65, owning their own property and in no way shape or form can the guarantor be the partner or spouse of the individual applying for the loan.

If you are considering being the guarantor for someone on a loan, you need to think carefully about how well you know the individual before you sign the papers. Can you rely on the person to make the payments or are they likely to miss payments and leave you in a situation where you are paying off the money for something that they purchased? Similarly if you are taking on a guarantor loan then you need to appreciate what your friend is doing for you and make sure that you don't let them down.

by: Dominic Donaldson

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