You may have heard a lot about guarantor loans, and you may have heard that they are the best way for you to obtain the finance you need to improve your credit rating and life, but you may still be none the wiser about what a guarantor loan is. If you are asking what is a guarantor loan, you will hopefully find this guide to be of use and benefit.
You will find that a guarantor loan is a form of unsecured loan. This style of loan requires the applicant, or the borrower of the loan, to call on an additional person, and this additional person will act as a guarantor.
The range of time that a guarantor loan can be taken out will vary but you’ll find that the loan will tend to last for a period of between 1 and 5 years. The amount of money on offer from your guarantor loan lender will vary but you will usually find that guarantor loans are available for sums between £1,000 and £12,000.
Guarantor loans are not a new concept
There is a lot to be said for the fact that guarantor loans are not new, and they are far from being an innovative or recent concept. This is the way that banks and lenders used to decide who to lend to, long before computer credit scores became the most common way of deciding who gets a loan. This is a trust based system and you will find that some landlords and mortgage providers are looking for people to provide them with a guarantor in the present day. There has been a strong comeback of guarantor loans in recent times with many people and institutions realising that this traditional method still has a lot to offer in the current climate.
While there are many positive aspects of a guarantor loan, you should stop and think as to whether a guarantor loan is right for your needs. While everyone of a legal age can apply for this style of loan, it is thought that they are best suited to people who have been denied a loan from traditional lenders. If you need finance to move forward and make progress in life but have been denied by the traditional lenders, a guarantor loan could be exactly what you are looking for.