Published: 11/01/2021

Reasons to consider a Guarantor Loan

Why you should think about a Guarantor Loan

Choosing where to get a loan can be difficult. There are different loan types that are designed for those with high or low credit scores. If you have a poor credit score, it can be really difficult! To try to help you, we will give you some reasons and information to show why you should consider a guarantor loan.

What is a guarantor loan?

Guarantor loans are a type of loan taken out with someone else and can be one of the most secure loan types available for those with a poor credit score. A guarantor loan is often taken out with a family member who would become responsible for paying back the loan if you are unable to do so. This means that both of you must meet 1Plus1’s guarantor loan affordability and creditworthiness assessments.

How does it work if you need a loan?

Guarantor loans aim to provide those that are looking for a loan with the option to get alternative finance in the case of a financial emergency or expense even with a poor credit score. Because of the additional security that is provided by the guarantor, you may be able to borrow a much larger amount at a much lower APR than if you applied for a payday loan. It also means that regular payments will be made on the account by you or your guarantor.

Can I be a guarantor?

In order to qualify as a guarantor with 1Plus1 guarantor loans, you will need to meet the following criteria:

  • Have a good credit history
  • Be a resident in the UK, and a tenant or a homeowner
  • Be aged from 18 or over, but no older than 80 when the loan completes
  • Be able to afford to make payments if the borrower fails to pay

When you have met these criteria, you may be eligible to be the guarantor on a loan for a family member or friend. This will enable your family member or friend to have the funds they need and if you need to make any payments be able to pay to ensure that your credit score is not affected if that happens.

Why consider a guarantor loan

  • Clear those unexpected bills – many of us manage our money from one month-end to the next, which means an unexpected bill can be a financial shock. With a guarantor loan from 1Plus1 guarantor loans, you can pay off the bill as soon as possible so as not to affect your credit score.
  • Meeting car repairs – Repairs for your car can be another hit on your finances, especially if you need your car for work. A guarantor loan can help to pay for these repairs as soon as possible and get you mobile again.
  • Home improvements and repairs – Home repairs and improvements are a something that many of us can’t afford from month to month. A guarantor loan can provide you with the cash you need to fix things up all with the additional layer of security.
  • Better security for larger purchases – When making larger purchases, maybe for a new car, it is good to have this level of security if you have a poor credit score and can’t be accepted for HP. Using a guarantor will make sure that all the payments are met with ease.