This is the best way to get any amount between £1,000 and £5,000. These are supremely convenient. You’re probably someone who had some issues in the past due to which you have a low credit score. You’ve turned over a new leaf but your past is catching up with you! Getting a loan has been a pain!Since banks don’t consider you an ideal candidate, you’re constantly getting turned away.
While doing your research, you will find that there are different loans available for someone with a low credit score. One option is that of a Secured Loan.
Now the issue with a secured loan is that you have to put one of your assets on the line. Just in case of non-payment, your house, car or whichever asset you have put against the loan, could be taken away from you. This is extremely risky. Secured loans also have a higher rate of interest.
Guarantor loans solve all these basic issues.It is an extremely easy and affordable process. You are treated as a borrower with a good credit score, since you have the backing of a guarantor, in case you are unable to pay the monthly payments. A trusted friend or relative can be held as your guarantor. You will also receive competitive interest rates of someone who has good credit! No over payment of interests!
Guarantor loans do not have an insanely high interest rate. This is possibly one of the biggest advantages of using these types of loans. The payment installments per month are flexible. Lenders happily lend out their money because they are not worried about getting it back. In the unfortunate situation that you are unable to repay the amount, they already have a guarantor who will make the payment.
Applying for loans is often tedious. The process is long with several different documents needed. However, this is a simple process. All we need is income and identity verification for the guarantor and you! The entire process is online and simple to understand. You do not have to run from one place to another turning in your paperwork! All you have to do is upload your documents online! There is no need for physical paperwork.
This is also such a great way to improve your credit score. If you are going for this type of loan, it obviously means that your credit score has taken a bit of a beating in the past. If you read articles such as This on how to improve your score, you will see that when you make your payments on time, your credit score slowly begins to recover!
Guarantors are always afraid that their credit will be hit if they sign up to help their friend/ relative. This is untrue. The loan is not counted as a debt against the guarantors name unless they are unable to fulfill the terms and conditions of paying the monthly installments in case the borrower does not make the payments that had been agreed upon.