If you are facing bad days with regard to the financial situation, you have the option to get a guarantor loan with the help of a guarantor. Guarantor loans can help you in situations when your bad credit may leave you in a situation where you find it impossible to apply for a traditional loan. Or you may have a poor history of managing your financial affairs such as payment of bills, installments, etc. A family member or one of your friends gives the guarantee to pay your installments in case you are unable to do so.
Guarantor loans are similar to traditional loans in the sense that you receive the loan from a lender and payback in monthly installments; however, a third party, i.e., your guarantor, is also involved in this process.
Guarantor loans are beneficial when you need money urgently. Many people in the UK avail the option of guarantor loans. You are required to hold a valid UK bank account to apply for a guarantor loan.
Now loan can help you increase your chances for the approval of your application with the support of a dedicated and hardworking team.
Benefits of guarantor loans
Some of the significant benefits of guarantor loans are as follows:
•Get a loan with bad credit
Poor decisions in the past may leave you with bad credit history and, ultimately, a bad credit score. When you have a bad credit score, it becomes difficult to apply for a traditional loan. Guarantor loans give you the advantage of getting a loan even with a bad credit score.
•Improve your credit score
Guarantor loans give you the incredible opportunity to improve your credit score. If you pay back your loan on time, your credit score will be enhanced, and you will be able to apply for traditional loans in the future as well.
•Lower interest rates
Guarantor loans are meant to help you in difficult situations, especially with your bad credit score. Therefore, the interest rate on these loans is much lower compared to other loans for bad credit, such as payday loans or credit card loans.
These loans give you more flexibility. You borrow the money and choose the installment period according to your needs. You can also pay back the amount early than required, helping you achieve even better credit scores.
If you are successful in finding a reliable guarantor, then the chances of the approval of your application increase greatly. These loans are approved very quickly, sometimes within a day, and when approved, the money is transferred to the guarantor’s account within a few hours
•More security for lenders
Guarantor loans not only help the borrowers but lenders as well. If you are unable to pay back your loan on time, someone is there to do so on behalf of you, giving more security to lenders.
•You can borrow a sufficient amount of money
Having a reliable guarantor makes you eligible to borrow considerably more than compared to other loans for bad credit. People can borrow up-to £10,000, which is more than enough in most cases.
Guarantor loans are a good choice when you have bad credit, and you can’t apply for traditional loans. They give you the flexibility in terms of repayment, interest rates and also give you benefits like improved credit score; however, to do so, you need a guarantor first. You will have to find someone with a good credit score who knows you well. The ultimate decision to approve a person as your guarantor rests with the lender.