When it comes to finding financial help, you should look to find as many options as you can. There are some loan options that are the obvious choice for many people, but these may not be available to everyone. Your ability to obtain finance may depend on your credit rating, and if you have a poor credit rating, you may find that traditional loan companies will not offer you a loan.

This is where people look for other options and a lot of people consider payday loans to be of benefit. These loans offer fast solutions and they are available to virtually everyone, but they shouldn’t be considered to be a viable option. This is because the APR for payday loans are extremely large, which means that you will end up paying a great deal of money with this style of loan.

One solution that an increasing number of people are turning towards is a guarantor loan. If you are unsure of what a guarantor loan is, you will be pleased to know that explaining a guarantor loan is a very simple process. This type of loan is available for people with a bad credit history and people who no credit history at all. The loan required an individual to support the loan application, and this is the person who is recognised as the guarantor.

Choose your guarantor carefully

There is usually a number of criteria that a guarantor must meet, although be sure to check the terms and condition of the guarantor loan company you look to use. The criteria normally include:

• The guarantor must be aged 18 years or older
• The guarantor must be a home-owner
• The guarantor must have regular income
• The guarantor must have a good credit history

One of the best things is that a guarantor can be anyone you know, although most firms will look to ensure that the guarantor is not financially linked to you. This means that a spouse or partner may not be accepted as a guarantor, but aside from that, there is no real barrier to someone becoming a guarantor for your loan application. It is best to choose someone that knows you and who can vouch for you though because they will be taking on a great responsibility with their role as a guarantor.

Once you have your guarantor and the loan has been accepted, the guarantor loan transpires much the same way as a standard loan would, with the borrower being expected to pay back the loan on the agreed date and with the agreed values.

The guarantor element only comes into play if the borrower misses a payment or is unable to comply with the requirements of the loan.