A guarantor loan is a great way to increase your chances of being approved for a car loan if you’ve got a poor credit score or no credit score at all.
Technically, the guarantor for your loan can be anybody between the ages of 18 – 75 with a regular income, they don’t necessarily have to be a homeowner but this would increase the chances of being accepted.
With this kind of guarantor loan, you remain responsible for making the repayments, but if you default, your guarantor has accepted to make those payments on your behalf.
Due to the nature of the above, it’s a good idea to make sure that your guarantor is somebody that trusts that you can make the repayments and that you have a good relationship with. Most people tend to ask member of their family or a very close friend.
Your guarantors will have to go through the same checks and processes as you – they will need to provide bank statements, bank details and proof of ID, for example, so that the finance lender knows that they’re a suitable choice.
Choosing to take a Guarantor Loan can make it much more likely that you’ll be accepted for finance.
Another big advantage is that because you will be repaying the monthly payments, a guarantor loan can also help you build and improve your own credit score, this means you will be improving your chances of being approved for finance in the future.
How will a guarantor help me get a loan?
In the eyes of the lender, having a guarantor makes you a much safer bet.
It gives them a reliable back-up option that they know they can depend on for payments.
Because of this, you may be offered lower APR’s than you could obtain elsewhere.
Once you and your guarantor has been accepted and all the boxes have been ticked, most guarantor loans are paid out within 48 hours.
If you feel that a guarantor loan is the best option for you, why not call one of our Guarantor Loan specialists at My Car Credit on 01246 458810 who will be more than happy to help you through the quick and easy process.