So you have heard of guarantor loans but you are not too sure of what they entail or how exactly this loan product works.
Guarantor loans have become a very popular way to lend money over the last decade. This form of loan is an unsecured loan product. It is specifically aimed to be an alternative from regular loans and for those members of the public without the best credit records.
In other words, should you have a bad credit record or even if you are blacklisted, you could still qualify for a guarantor loan, although when applying, you will require someone to co-sign your application and stand as a guarantor against the loan – hence the name! That co-signature provides the lender with the security they need to approve the loan.
Now we often face times of uncertainty when we need money in a hurry. This could be an emergency like a medical crisis or a death in the family or to repair damage to a house, for example. At (insert name here) we believe that even though you have a less than spectacular credit history, you should be able to access some form of credit.
But guarantor loans can be used in another way. For those with a bad credit rating, by paying off their guarantor loan and not defaulting, they are improving their credit rating little by little. It can also be used by those who have no form of credit rating whatsoever – think of a school leaver who has never taken credit ever before. A guarantor loan can help them build a positive credit rating, something that is not very easy to do for those who have no form of it whatsoever.
So who can act as your guarantor?
Pretty much anyone actually. We do not set a rule in this regard so at the end of the day it should be someone who:
• You trust to act as your guarantor
• You don’t mind letting into the fact that you are applying for a loan
• Will agree to act as your guarantor
• Will pay your loan should you default
Bear in mind, whoever you choose as your guarantor should have a good credit rating and be able to take over your loan payments if you are not be able to pay. For this reason, they need to be financially stable as well.
What are the benefits of a guarantor loan?
This form of loan has many advantages. Let’s take a closer look.
First, there are no credit checks for the applicant. So if you have been turned down for a regular loan because of a poor credit history, this won’t be the case with a guarantor loan. In fact, we don’t even worry about checking your credit score. Note, however, as discussed earlier, we will check the credit history of the person that signs as your guarantor.
Second, their annual percentage rate (APR) is extremely competitive. In this regard, they are on par with a logbook loan and much, much cheaper than a payday loan.
Third, there is no need for collateral. At no point will we ask you for collateral to be a form of security should you not pay your loan. Unlike a logbook loan that uses your vehicle as security, a guarantor loan just needs a guarantor that will co-sign with you.
Fourth, a guarantor loan is a great way to build a good credit record, either for those with poor ratings or those just starting out in their working life.
Fifth, when you are approved – a process that takes no longer than 24 hours – you will receive instant cash in your bank account. You can even apply online, although we will require a face to face meeting once you have been approved so you can sign the relevant documents.
What documents do I need to apply for a guarantor loan?
If you are going to apply for a loan, we will require the following documents from you.
• Proof of your physical address (bring a utility bill along)
• Proof of weekly or monthly income (we will require 3 months wage slips, either monthly or weekly)
• Bank statements (we need these to gauge your spending patterns which help us determine how much we can loan to you)
• Proof of identification (either your personal identity document, driver’s license or passport)
• Proof of identification for your guarantor
• Proof of weekly or monthly income for your guarantor
• Bank statements for your guarantor
There are many fly-by-night loan companies out there? Why should I use your company?
We have been in the loan business over the past decade. Not only are our staff extremely good at what they do, they regularly receive training to cover new developments in the loan market. Perhaps the most important thing to us is our clients.
At Square 1 Loans , we realize that without you, our business cannot go on. For that reason, we go out of our way to not only help you but to ensure we give you the best loan product available. No fine print, no trying to catch you out, just a loan at a competitive rate. We know that if we treat you correctly, you will return for a new loan if you ever need to, but more importantly, you will tell your friends how we helped you with the best loan rates available.
We want to help you, we want to see you build up your credit rating and we have the means to do so.