Introducing Talk Guarantor Loans

Talk Guarantor Loans is a brand new guarantor loan brokerage that have recently launched into the market. They differentiate themselves from the competition by offering a more personalised service, and making sure they find you a lender that is fit for purpose.

Other brokers in the market will try and automate everything, and in the process you are often matched to a loan company that does not truly meet your needs. Or even worse, in some situations your details will be passed to EVERY lender on the list which means you will end up getting multiple phone calls, from multiple people, offering multiple products (some who may even charge a fee) and at the end of the day you may be left with no loan and a general sense of confusion.

Talking is almost king at TGL (only second to the customer), which means you will be greeted by a human, UK based loan expert who will fully discuss your situation and allow you to make an educated decision on who you want to borrow from.

To learn more, or to apply with them, visit https://www.talkguarantorloans.co.uk.

Getting a Guarantor Loan to Pay For Your Wedding

The search for a soul mate and life partner can often be a long and arduous journey, and before you stumble across ‘the one’, you will undoubtedly kiss a few frogs, and encounter a number of weird and less than wonderful characters. Upon meeting that special someone, all of this bother is resigned to the past however, and following a period of courting and dating, the time will eventually come to start thinking about the big day.

Weddings: magical but expensive

Now it goes without saying that your wedding day will be one of the most important, if not the most important, days of your life for both you and your partner. Unfortunately such importance comes at a high price, and as any married couple will tell you with a wince, your wedding day will also be one of the most expensive days of your life too, what with the average wedding in the UK costing in excess of £18,000. It is all too easy to get swept up in a whirlwind of excitement, expectation, and pressure, and so much does it matter to make the big day perfect that love will almost always override financial prudence.

Keeping your big day in budget

So financially speaking, the big two tasks for a soon to be married couple is to firstly keep a lid on costs by keeping expectations realistic, to prevent costs from spiralling out of control. Secondly is the small matter of funding it! It is quite feasible to budget carefully for a wedding and plan out a day which is memorable for all the right reasons, and still keep the cost far below the £18,000 average. However there is no escaping the fact that a wedding will cost you somewhere in the thousands, and if you like many others do not have that kind of money to hand, you will no doubt opt to borrow in order to cover the costs of your wedding.

What is a guarantor loan?

If you have a less than perfect credit score and are unable to secure credit from a mainstream lender, why not consider a guarantor loan as a means for paying for your wedding day? Guarantor loans, a traditional form of trust based lending, are an increasingly popular form of acquiring much needed credit. You can borrow anywhere between £1000 and £7,500 over a 1 to 5 year period (depending on the amount borrowed), even if you have less than perfect credit. And with rates of interest fixed at 47.9% APR for a £3000 guarantor loan over 3 years, repayments can be made which are both convenient and affordable.

Guarantor requirements

You will need to find a suitable guarantor to support your application and co-sign your loan agreement once it has been processed. This is in line with the trust based nature of guarantor lending, and it is a promise that the guarantor will only be contacted and asked to make repayments if you can’t. Anybody, aside your husband or bride to be can act as your guarantor, provided they are a homeowner, earn a sufficient income to potentially cover repayment costs, and have a good credit history.

Keeping Your Guarantor In The Loop

Introduction

Looking for credit in this day and age when you don’t have a particularly great credit history will probably have brought you to the door of a guarantor lender. Guarantor loans have grown greatly in popularity since the recession hit and the mainstream lenders became more wary about lending to anyone who couldn't prove they were great at paying credit back. They’re pretty popular now as a result, and although they may seem like a new concept, the fact is that guarantor lending used to be the only way to borrow if you didn't have an asset to borrow against.

The Support of the Guarantor

If you've taken on a guarantor loan in the last couple of years, you’ll know that the guarantor (a close friend or family member) is an integral part of the process. They sign a loan agreement along with you, and therefore agree to pay any loan instalments that you can’t pay. This is rare, as most guarantor lenders will do a full check on anyone they’re lending to, in order to ensure that the loan is affordable to them. To avoid doing these checks would be unfair to both the borrower and the guarantor, as both would end up in trouble through the borrower not being able to pay.

Making Repayments

One of the main things that you need to do as a borrower, aside from making sure you meet each and every repayment in full and on time, is staying in contact with your guarantor. It’s unlikely that your lender will contact your guarantor unless there is a problem. For this reason, it may be handy to keep your guarantor updated when you make payments, and you should certainly give them prior warning if you’re worried about making a payment, as this could trigger contact from the lender.

Keeping Your Guarantor in the Loop

Although it may feel unnecessary to let your guarantor know every time you pay a loan instalment, it could reassure them that you’re handling the loan properly and it will act as a gentle reminder that they've signed up to lend a helping hand should something go wrong. There have been cases where a guarantor has been asked for payment, and they've forgotten all about agreeing to be part of their relative’s/friend’s loan. This can cause a bit of tension and stress, so keeping your guarantor in the loop is an important part of managing the loan properly.

Choosing the Right Guarantor

Your guarantor should be someone that you know and trust, so keeping a close relationship with them throughout the loan term is very important. In the case of most, this will be a no-brainer, but for some their guarantor has come from a short but intense friendship which has dissolved or grown apart since the loan was taken out. Keeping in contact with someone (even if you may not have done so without the loan) can really help if you find you have problems paying one month, or if the lender has a query or question that needs answering by them.

Guarantor Loans: A Smart Alternative to Payday Lending

If you happen to have a good credit score, you will be fortunate enough to be able to benefit from near record low borrowing rates on a wide range of credit products, such as loans, credit cards, overdrafts, and mortgages. If on the other hand your credit score is less than perfect, the red carpets will quickly be rolled back and the doors to the mainstream lenders will unfortunately be slammed shut. Much to the fury of many consumers, the banks and other mainstream lenders remain very cautious and risk averse when it comes to the subject of consumer lending, which has strongly worked in the favour of the payday lenders.

People turn to payday lenders for lack of a better idea

The constant barrage of TV adverts and press surrounding the payday lenders means that they are more often than not at the forefront of people’s minds, so when somebody is rejected by their bank, it is often the payday lenders who have been the first port of call immediately after. And make no mistake, they are convenient! But however convenient their quick pay outs and a no questions asked approach to lending may be, the simple fact is that the enormous interest rates of easily over 4,000% APR can be crippling and there are hundreds of thousands, if not millions who have quickly found themselves struggling in a debt spiral after their payday loan repayments have spiralled out of control. With this in mind it is unsurprising that consumers have increasingly been turning to alternative means of borrowing money when they are in a financial pickle, and of all the alternatives out there, guarantor loans have increasingly become the borrowing option of choice for those with poor credit.

What is guarantor lending?

Guarantor lending may appear at first glance to be a new approach to borrowing but it is in fact a throwback to a more old fashioned form of borrowing from years gone by. A guarantor loan applicant will be asked to find a friend, family member, or colleague to co-sign their loan and act as their guarantor, and in return for this they will be able to borrow small to large sums of money over a short to longer-term time frame. And more importantly, not only will a guarantor loan be flexible but it will also offer much lower rates of interest and a much more affordable loan all round. A borrower will be able to borrow anywhere between £1,000 to £7,500 over a 1 to 5 year period, but importantly they will be able to do so at a much more reasonable 47.9% APR; just to paint a picture, a guarantor loan of £3,000 taken out over 3 years will cost £143.98 per month in repayments. Now this, compared to a payday loan which charges around £25 for every £100 borrowed, represents a much more suitable borrowing option if you are looking to consolidate debt, replace a car, or cover a large unforeseen expense. Your guarantor, who will need to have good credit and be between 25-65 if they are a tenant or 25-72 if they a homeowner, will not be contacted under any circumstances unless the borrower cannot meet repayments. So if you need to borrow, why not go for a guarantor loan?

What does it take to be a Guarantor?

Being a guarantor is something that you may have heard of before, as the idea behind having one has been around for a long time. The re-emergence of guarantor lending since the recession has brought guarantors out into the open again, although they never really went away.

If you have ever rented a home then it’s likely that you would have had to get a guarantor for your rent (this is particularly common for university students or for those who have moved out of home for the first time. It’s also common to ask anyone on a relatively low income to have a guarantor in place). A guarantor is someone who you know well, who is more established than you are financially, who could pay your rent in the event that you don’t, for whatever reason. They would have to sign an agreement committing to this, and it’s likely that they’d be credit checked to confirm that they are who they say they are.

In the distant past, long before telephones or computers and credit checks, if you wanted to borrow money then a guarantor was a staple of the application process. It’s likely that they would act like a ‘sponsor’ and be known to the bank manager. The loan would be paid out on the condition that the guarantor was an upstanding member of society – the bank manager would know their financial situation and would help you out on the basis that they could vouch for you. Back then, status was everything, whereas nowadays the class system has pretty much lost a lot of its former power.

Guarantor loans have emerged again in the years after the recession hit, as all of a sudden access to easy credit has been greatly reduced. Before the financial crash, the banks were happy to lend money to many different people without doing a huge amount of pre-payout checks. This was a good time for the economy in the sense that people were spending money, but unfortunately not all of what was borrowed was making its way back to the banks, as they had agreed to lend out much more than customers could afford to pay back. Now that the banks have tightened their lending criteria, many people have been left out in the cold when it comes to credit, but guarantor loans can now utilise the ‘vouch for’ benefit which featured heavily before the boom years.

If you've been asked to be a guarantor for someone, then you’ll have to fit into set criteria depending on the company your friend/relative is applying to. Usually guarantors need to have a decent credit history, must have enough income to pay back the loan in question (while this is rare, it does sometimes happen) and will ideally trust the borrower to pay back the loan on their own. Many guarantor lenders require the guarantor to be a homeowner, but some lenders do offer tenant guarantor loans at a slightly higher rate of interest. 

Why do Guarantor Lenders Need to See Documents?

If you or if someone you know has applied for a guarantor loan recently, then you’ll have probably noticed that the lender needed to see some documents before processing the application. Many lenders will ask their applicants for some kind of evidence of who they are and what they earn, but this is not as common for lenders who advance money to those with a poor credit history.

The point of asking for documents is to provide some extra security for the lender, as well as the customer themselves. By being careful about who they lend to, guarantor loan providers are keeping on top of fraud and protecting their customers (both the borrower and the guarantor) against losses associated with this.

What might I be asked for?

When you apply, you’ll be asked to input your details like your name, address, salary and date of birth. These are the basic details that lenders need to ensure that you can A) pay back the loan you want and B) be checked with a credit reference agency. It’s important that the lender knows that the person applying is who they say they are, as otherwise identity fraud could be an issue. For this reason, you will probably be asked to provide a copy of your driving licence or passport so that they can verify that you are who you say you are. The same goes for the guarantor, as it’s paramount that the person agreeing to guarantee a loan knows what they’ve been signed up to.

You may also both be asked for a proof of income and bank statement. This proof of income could be as part of a wage slip or job contract. This is to make sure that you can afford to pay the loan instalments, and that your guarantor is also able to afford it if they have to step in. Most guarantor loan providers lend responsibly, which means that they ensure their customers can afford to pay back their loan without getting into further financial difficulty. The bank statement can help the lender check that you have enough left over after your essential expenses to afford the loan repayments.

How do I give them the documents?

You should never send original copies of your important and personal documents to a lender. Instead, you can make a copy by scanning it in and sending it via email, taking a clear picture and sending the image from your phone or some lenders will also accept faxes. You may be able to post the copies of your documents also, which means there are plenty of ways in which you can provide the necessary evidence.

Different guarantor lenders may require different supporting documents, and each will have varying options as to how you can get them to the lender. If you’re unsure about what you need to provide, asking the lender then give them a ring. This can help to clear up any confusion, and it can also give you a good idea of their customer service.

Comparing Loans For Bad Credit

If you have a poor credit history (or, if you’ve never borrowed before, no credit history at all) then you may find that getting a loan or other kind of cash advance from a bank or other mainstream lender is pretty difficult. This is because the lender needs to see that you have borrowed money and paid it back in full and on time in the past. This gives them a good idea of what you will be like to lend to, and whether they will get their money back or not!

Below we’ve listed the most common types of loans aimed at those who have bad credit histories. When searching for a loan it’s important to look at the pros and cons of each and to think about how the repayment terms fit in with your life.

Logbook Loans – APR 400+%

These loans are secured against the value of your car, motorbike or van, so for the duration of the loan, the lender will effectively ‘own’ your vehicle. You are allowed to keep using it as normal of course, but if you fail to make any of the repayments, it may be taken from you. Because the loan is effectively secured, your credit history may not be searched. This also means, however, that if you pay your loan back in full and on time, your credit history may not be updated either.

Instalment Loans – APR 300+%

Instalment loans are small loans (up to around £1000) which are paid back over a period of a few months. This allows people to borrow a small amount of cash but pay it back in more instalments, meaning that it’s easier to manage. Your credit history will be checked and your credit file will be affected by how you deal with the loan, so paying this back in full and on time should boost your score.

Guarantor Loans – APR 45+%

A guarantor loan can offer more in the way of lending amounts (up to £7,500) but requires a friend or family member to ‘back up’ the loan application, meaning that if you cannot pay, they will be liable to pay on your behalf. Once again, your credit history will be checked first and will be affected by the way you deal with the loan repayments. The repayment terms are between 1 and 5 years, meaning that a higher loan amount could be made more manageable for you.

Payday Loans – APR 1000+%

You have probably heard of payday loans as they have had a huge market presence in the last few years. These are small, short term loans (up to £1000) which are designed to be paid back by the time the borrower is next paid. This means that the full amount owed needs to be paid back at once, which can be tricky for some people. Your credit history may not be checked but a payday loan on your file will look bad to other lenders and could mean you find it hard to get credit in the future.