February 2020 – Ludlow Finance

Everything First Time Borrowers Should Know About Guarantor Loans

You will have lots of different types of loans to choose, so you don’t want to make your choice lightly. The more you learn about guarantor loans, the better your chances will be of getting the most from one. These loans offer a wide range of benefits that you should know about before making up your mind either way. The information in this article will help you to make a decision that will match your needs perfectly.

What is a Guarantor Loan?

First we will take a look at the nature of guarantor loans. It is basically a loan that requires you to find a “guarantor”, which is someone who co-signs. This person has an equal responsibility when it comes to paying back the total amount of the loan. If you cannot fulfil your obligation to the lender, the guarantor automatically assumed responsibility.

Who is Eligible to be a Guarantor?

When you are looking for someone to serve as a guarantor on your loan, there are a few things to keep in mind, including:

Credit rating: A person must have at least a decent credit score to be approved as a guarantor on someone’s loan. They need to have a high score and a clean history.
Income: There will definitely be requirements regarding the guarantor’s income as well. They need to make enough from their job for the lender to feel comfortable in their ability to pay back the loan.
Job stability: A solid employment history will certainly work in their favour as well. Lenders don’t like to see applicants with spotty job histories.
Other requirements: This person also has to meet the minimum requirements of getting a no credit check loan, including legal UK citizenship and being over 18 years of age.

Before you choose someone in particular to be your guarantor, you need to think carefully. It is important that you select a person who is very trustworthy and can be relied on.

Benefits of Obtaining a Guarantor Loan

There are plenty of benefits associated with guarantor loans that you should really be aware of before making a final decision.

Higher Likelihood of Approval

Getting a guarantor to sign onto your loan will instantly boost your chances of approval. You will most likely have a much easier time with getting the green light for your loan application this way. The lender will feel a lot more comfortable giving you a loan if there is someone to step in and pay it off if you are unable for whatever reason.

If you have bad credit, getting a loan of any kind can be a bit tricky. This type of loan will instantly boost your chances of approval, even if your credit rating isn’t great. This is one of the most common reasons that people apply for these loans in the first place.

It Costs Less than Other Loans

Guarantor loans also tend to cost borrowers less than other types. This is because the interest rates are usually lower. When you don’t have a high rate to contend with, you won’t have to pay nearly as much.

This will also increase the chances of paying back your loan on time without any problems. The rate that you end up getting will depend on numerous factors though, such as the amount you are borrowing.

Get the Money you Need Quickly

If you need a substantial sum of money and cannot afford to wait, a guarantor loan is worth considering. This type of loan can give you a way to obtain funds fast. It usually doesn’t take more than a day or two to complete this process. It can be very helpful when you have some sort of expense that is absolutely crucial.

Before you Borrow

You will need to make a point of researching some of the lenders on the internet that give out guarantor loans. This will serve to help you quite a bit when it comes to getting the best possible overall terms for your loan. It will also help you find a reliable and trustworthy lender, which is also very important. Compare the rates and fees that these lenders charge before settling on a certain lending company.

There is no question that guarantor loans can be helpful to many people. You definitely want to spend some time looking into this option before making a decision. It is a great option for just about any person who needs to borrow money right now. This is an especially good type of loan for those with bad credit. If you have a bankruptcy or vehicle repossession in your credit history, a guarantor loan is worth considering. These loans are pretty easy to get and can even help you save quite a bit of money.

Frequently Asked Questions About Short Term Loans

Most people don’t know nearly enough about short term loans and everything they have to offer. When you need to borrow money, it is a good idea to get answers to some of your questions before going forward. This can help you to get an excellent overall deal on one of these loans. The more you educate yourself, the less likely it is that you’ll experience any problems when borrowing money.

Where do I get a Short Term Loan?

You will be able to get a short term loan from a private lending company. These days most private lenders are based completely on the web. The number of brick-and-mortar lending businesses has been declining for quite some time now. It is important that you review some of these choices before deciding to go with a certain one though.

How do I Apply for a Short Term Loan?

Once you have found a reputable lender online, you will be able to complete an application on their site. This form will request some basic details like your first and last name, physical address, email, and other things. You will also have to submit details about the loan you want, including the total amount. These applications are usually pretty quick and painless, so you’ll have nothing to worry about.

How much am I able to borrow?

Short term loans are often given out for amounts that range from £100 to over £2,000. Just keep in mind that some people are able to borrow more than others, depending on their income. When you apply for one of these loans, the lender will want to know how much you make. This will be a major deciding factor as to whether or not you’ll be approved.

What is the Payback Period for Short Term Loans?

The amount of time that you get to pay back a short term loan largely depends on how much you borrow. If you were to borrow £2,000, you’d probably have at least a couple of months to pay it back in full. There are some lenders that give borrowers up to six months to pay back their loans. A lot of these lenders will give you the option to choose your loan term when you are filling out the application online.

Who is Eligible for a Short Term Loan?

The good news is that lots of people are eligible for short term loans from private lenders. You could be approved even with a low credit score.

There are, however, some basic requirements that you will need to satisfy. This includes being over the age of 18 and a legal UK citizen. The lender will also require you to have a valid bank account. If you do not meet these requirements, it is very unlikely that your loan application will be approved.

I am Self-Employed. Can I still get a Short Term Loan?

Yes, even those who are self-employed will still be eligible for short term loans. You will need to submit proof of your revenue to the lender. Pretty much all of these lending companies welcome entrepreneurs, so you shouldn’t encounter any issues.

Are there Limitations on what the money can be used for?

Private lenders don’t care what you want the money for, so there are no limitations on how you can use it. This in direct contrast to a bank loan, which restricts what you can use the money you borrow for. You might find that the application that you will out asks you this question, but you can put anything you want.

Is My Credit Going to be a Problem?

Many people worry about not being able to get the loan they need due to bad credit. While the lender is going to run a credit check when you apply, this is not necessary cause for concern. The fact is that plenty of people with awful credit ratings get approved for these loans all the time. You therefore still have a good chance of getting the loan you need.

How do I pay back a Short Term Loan?

You will be required to pay back all of the money you borrowed plus interest by the due date. The term of the loan will be agreed upon by both parties before approval is given. It is important that you know when the loan is due to be paid so you don’t forget.

When you are searching for a lender to get a short term loan from, it is crucial that you ask them any questions you might have. You don’t want to get a loan of any size until you have all the necessary answers. This information and research will help you to avoid a disastrous situation in down the line.