Just because you have bad credit doesn’t mean you can’t avail a personal loan when a financial emergency strikes. You may not be able to avail traditional personal loans but you can beat your credit problem with guarantor loans. But before you get too excited and sign up for a deal, here’s a quick guide to how the financial product works for better understanding.
What are guarantor loans?
Guarantor loans, as its name suggests, is a type of unsecured loans where you can borrow between £100 and £12,000. The best part with guarantor loans, you can avail the financial product even with bad credit under your belt. So long as you’re of legal age and you have a guarantor to co-sign the debt agreement, you’re application is good as approved.
Guarantor loans are also widely known as non-homeowner or tenant guarantor loans. While other personal loans require borrowers to be a homeowner, you are still eligible to apply for a guarantor loan even if you’re a tenant. For more information on tenant guarantor loans, extensive guidelines are available from the original source.
Who can be your guarantor?
With tenant guarantor loans, your credit score doesn’t matter. What does matter is your guarantor’s eligibility. To be able to borrow money, you must have a guarantor who can be a family member, a friend or a colleague. He or she must be of legal age, a UK resident and more importantly must have good credit. The guarantor will be required to co-sign the debt agreement with you, which essentially guarantees your monthly repayments.
If your guarantor is a homeowner, you can borrow money greater than £7,500. If your guarantor is a tenant just like you, loan offers are less than £7,500.
How guarantor loans work?
As mentioned, a guarantor’s loan main requirement is for the borrower to bring a qualified guarantor. Depending on your guarantor’s eligibility, you can borrow a short-term loan between £100 and £750, a medium or long term loan between £500 and £7,500 and loans greater than £7,500.
Without any credit check required for borrowers, approval is often fast and quick for guarantor loans. Your guarantor just needs to guarantee your application and approval should be confirmed in 24 hours or less. As per the debt agreement, your guarantor agrees to guarantee your repayments. This means that risks are little to none for your lender. In the event that you cannot repay the loan, they will run after your guarantor as per the debt agreement.
Why choose guarantor loans?
If you have bad credit and you need quick cash, a tenant guarantor loan comes handy. The loan product is widely available and accessible online. The requirements are also very minimal allowing more borrowers to avail the financial product. But more importantly, guarantor loans exist to cater specifically to people with bad credit problems. If you’ve been struggling to get short-term financing because of bad credit, guarantor loans are the answer to your financial emergencies. Provided that you have the requirements ready prior to applying, you can get approved in as fast as 24 hours or less.