Guarantor Loans

Guarantor Loans

Guarantor loans up to £10,000 paid out in super quick time. Bad credit acceptable.

Guarantor loans explained

Guarantor loans are special loans that allow people with a poor credit history (even an absolutely terrible credit history!) to obtain a loan of up to £10,000 and assuming you find someone applicable to endorse your application (the guarantor), then you are guaranteed to get accepted.

A guarantor loan is an unsecured loan which means that it is not secured against your property or other asset (this is definitely not a logbook loan or anything similar!) and is particularly suitable for:

  • Tenants – private or local authority
  • Homeowners without equity in their property
  • People living with their parents / family

In addition and as mentioned before, there are absolutely no credit checks which means that even if you do have a track record of missed rent or mortgage payments, late credit card payments or even if you have a few defaults or county court judgements (CCJs), then as long as you provide a suitable guarantor, then you are 100% guaranteed to be accepted.

How does a guarantor loan work?

The loan works like this; the borrower makes an application through the online enquiry page here at as normal. They will also provide details of the person who will be their guarantor (more details on who can be a guarantor further on) on the application.

We will then work out the repayment schedule, the interest rate (usual high street rates) and the repayment period and then we will assess the application based on the guarantor’s credit history, not the borrower’s. Once agreed the loan will then be paid into the borrowers bank account and a monthly direct debit will be setup in the borrowers name and all monthly repayments will come out of the borrowers bank account.

So where does the guarantor come in?

Aside from the initial assessment, the guarantor will have no further part to play unless the following situations arise:

  • Borrower cannot repay the loan
  • Borrower will not repay the loan

If either of these situations develop, then the guarantor will become liable for the outstanding loan including costs. The lender can also instigate legal proceedings against the guarantor, not the borrower, if the loan is not repaid under the terms of the loan agreement, so any potential guarantor need to understand the role they will play and their legal obligations in respect of the loan. Obviously, any non repayment will reflect on the guarantor and not the borrower which means that the main credit reference agencies such as Equifax and Experian will be informed and this will severely hamper someone’s ability to get accepted for any future credit.

Who can be a guarantor?

As long as the person endorsing your application is a homeowner, has a clean credit history, is employed in a full time position and is over the age of 21, then it can be absolutely anyone. You could call upon a family member, neighbour, colleague or in fact anyone who has a clean credit history and is prepared to back up your application and of course, be responsible should you not meet your obligations with the loan.

And finally it is worth remembering that taking out a guarantor loan will mean that the borrower will be taking on certain responsibilities and regardless of whether they are responsible for the repayment or non-repayment of the debt; they have to understand the implications. However there is a plus side to this as it also means that if the loan is repaid on time every time, then the borrower’s credit profile will also improve as an indirect result of the loan being conducted properly throughout the term.

Money or debt worries?

Money worries?

Money worries?

If you have then you should not even be considering a loan, guarantor or otherwise as it will simply add to your debt. Whilst an instant cash boost is what you might need there and then, think of the consequences. If you take a loan out and it is more than £1,000 then it is likely that you will have to pay that loan back over a few years, more than likely 3 or 4 years. That means yet more debt you have to pay back and it also means that your monthly disposable income is reduced yet again.

Is that what you really need?

So if you are thinking of taking out an unsecured loan with us, before you do, take a step back and give yourself 24 hours before you decide if you need it or not. If after 24 hours you think that you don’t, then definitely do not take a loan out.

The reason for this is that so many people have a knee jerk reaction to needing money rather than thinking of the long term benefit and that is why we ask all of our potential borrowers to think long and hard before they make that final decision to take out a guarantor loan.

To find out more (and remember that we never charge any upfront fees) simply complete the simple online enquiry form here.

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Small guarantor loans

Generally speaking, most guarantor loan companies offer loans from £1,000 to £5,000 and some like offer loans up to £10,000.

However there are occasions where the borrower doesn’t need anything like £1,000+ because either their immediate needs are for far less than that or they are worried about taking too large a loan because of the repayments and/or interest to be repaid. A small guarantor loan up to £1,000 may be all that you need to sort out your immediate financial needs and unlike a payday loan, a guarantor loan can be taken over 12 months or even 2 years so the monthly repayments will tend to be a lot more affordable.

The other thing to note about a guarantor loan (even a small sub £1,000 loan) is that after 6 monthly payments have been made, borrowers can ‘top up’ their loans and increase the amount borrowed to £10,000 if they wish. The reason they have to wait 6 months before this can happen is because it gives the lender time to assess the borrowers payment record and in this period, it is enough time for the lender to see if the borrower has paid on time every month. If they have, then it shows the lender that the borrower is a fairly decent risk and extending their guarantor loan should be a formality.

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Unsecured Loans

Loans specifically for tenants or for people who don’t want a loan secured against their property. You can borrow up to £10,000 with our guarantor loans and we can even help you if you have bad credit, work part time or have been refused for a loan elsewhere.

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Before applying for a loan…

Before you apply for a loan online with us, you should ensure that a loan really is what you need. The reason we say this is because many people who apply to us for a loan then find that actually they would not be able to afford the monthly repayments.

Most of the time loans are used to pay off other debts or required to cover some short-term financial need and if this is the case (short-term financial need) quite often people will look to take out a payday loan. However the reality is this: taking out a payday loan is perfectly fine if the loan is going to be repaid at the end of that month. Where payday loans go bad, is where the individual taking the loan decides that they cannot repay the loan at the end of the month. So what they do, is to renew or rollover the payday loan for another month and once they have started doing this, they are in what’s known as a payday loan cycle and it is very hard to get themselves straight again.

Get approved for a loan

Now payday loan companies do get very bad press in the UK, however if used correctly they are a great way to borrow money and are in fact cheaper than using an overdraft facility from your bank.

The first thing that we do when we speak to a potential borrower is to ask them to fill out a budget planner. By doing this, the borrower will very quickly realise whether they can afford to borrow money or not and it is amazing how many people are surprised at how much or how little they have left at the end of each month. Now everyone should try and fill out a budget planner regardless of whether they are looking to borrow £100 or £100,000 and will take just 2 or 3 min to complete.

Once you have determined how much money you have left each month, you can then decide whether you still need that loan and you really have two options left open to you.

Option one-apply for a loan

So you have completed your budget planner and you have realised that you have enough money left each month to be able to repay a loan. All you need to do now is determine which type of loan is it you require such as a guarantor loan (if you are not a homeowner) or a secured loan (if you are a homeowner). All loans are subject to status however with the guarantor loan, the applicants can have quite extensive poor credit and still be accepted which is the reason these types of loans are very popular.

When you apply for a loan you will find that the term APR will be mentioned quite a bit. This is the annual percentage rate and all companies are required to publish this on their website. This fact sheet from the Guardian newspaper gives a good explanation of how APR’s work. You will notice from the article that the APR calculation is really not a good way to decide whether to apply for a loan or not because as we mentioned earlier, quite often a payday loan is a cheaper way of borrowing money then using your bank overdraft and yet with APR rates in the region of 1,500%, it immediately makes you think that’s a very expensive way to borrow money. As we have already said, as long as the loan is just for a set period of time (30 days) and you repay it at the end of that period, then in our opinion it is a perfectly viable way to borrow money.

Option two-rearrange your finances

If you have decided that you do not want to borrow any money or you have found that you’ve been turned down for a loan, then your best option would be to look at how you can manage your existing debts and finances. One way of doing this would be to look at consolidating your debts but not by way of a loan but instead via a debt management plan.

Now I know what you’re all thinking! Debt management plans must be the last resort and you read horror stories from people who’ve paid debt management companies each month only to find that their payments have not been reaching their creditors (their credit card company, loan company, mortgage company, etc). However that does not have to be the case because there are a number of companies offering free debt management plans and all they do is negotiate on your behalf with your creditors and arrange with them for you to make smaller monthly payments each month.

It is worth bearing in mind that debt management plans on offer everybody, however for those people that have more outgoings and they do income, they offer a sensible and ethical solution to their money problems and if handled correctly, they will allow a heavily indebted person to get on with their life and move on from their debts.

Speak to a professional

Whether you decide to apply for a loan or to enter a debt management plan, you should take some independent financial advice from an IFA. Many people think that you can only speak to an IFA when you’re looking to make a large investment or to discuss your pension options, when that is not the case at all. Most IFA’s are experienced in loans, mortgages, investments and debt management and will gladly sit down and talk to you about which option suits you best. And don’t forget, once you are back on your feet financially, and the IFA will be in a position to advise you on the best way to save your money and make your money work hard for you, so that hopefully you are not in this position again.

Students applying for a loan

A lot of our loan applicants students applying for a short-term loan because they have already spent their grant money or they cannot afford to live in the halls or other rented accommodation. The problem is that students cannot apply for a guarantor loan even though they would be ideal for this type of finance is all applicants must be working (even a part-time capacity) some students with a part-time job could apply for a loan with a guarantor, if they have enough disposable income left at the end of each month. Take a look at these student money saving tips as we never even thought of quite a few of them!

Whichever course of action you decide to take, remember that here at Any Type of Loan we can help you, so make an online loan enquiry today and will get back to you straight away and advise you of the best course of action.

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Complete guide to guarantor loans in the UK

There are so many articles and sites relating to guarantor loans it can all get a bit confusing so we thought we would take this opportunity to give you a full, uncut, warts and all guide to guarantor loans.

In this article we will cover:

  •     Who are guarantor loans aimed at?
  •     The basic qualifying criteria which you need to know before you apply for a guarantor loan.
  •     Which lenders are currently lending and their application criteria
  •     How much each lender will lend
  •     The application process

Who are guarantor loans aimed at?

Quite simply, a guarantor loan is designed to help people with a less than perfect credit history obtain a loan in their own name. Now that last point is vitally important because taking the loan in the applicants (the ones with bad credit) name will allow them to rebuild their credit profile.

Fact: Guarantor loans are always taken in the name of the applicant and NEVER of the guarantor.

This last point is very important and is the reason we advise borrowers to get a guarantor loan rather than asking a friend or family member to take a loan out on their behalf. Yes, the loan interest and APR will be cheaper but it does absolutely nothing to rebuild the credit of that individual, whereas a guarantor loan is very effective at rebuilding someone’s credit history / profile.

Guarantor loan criteria

Now we can’t speak for all lenders here however we have a pretty good idea as the vast majority all have the same qualifying criteria which is usually:

  •       Applicant has to be a minimum of 21 years of age
  •     Guarantor has to be a minimum of 23 years of age.
  •      Must be UK nationals
  •      Applicants can be tenants or homeowners BUT a guarantor MUST BE A HOMEOWNER although a mortgage is fine.

This may differ from lender to lender but it is broadly correct. For details on how much each lender will let you borrow please see below when I discuss each lender in turn.


List of Guarantor Loan Lenders in the UK

Amigo Loans (formerly known as FLM Loans)

Owned by the Richmond Group based in Bournemouth and started by James Bennamor, they were the first guarantor loan lender in the UK and pretty much had the market to themselves until a swathe of new independent lenders entered the market. Still, Kudos to Amigo for being the first to help tenanted borrowers with a poor credit history – up until this point they had nowhere to turn.

They lend up to £3,000 for new borrowers and up to £5,000 to existing borrowers who have a good payment history with them.


Whitestar Loans

A relative newcomer, Whitestar are based in Liverpool and Manchester and are the offshoot of a small bridging finance lender and launched in 2010. Maybe they are small but they were the first lender that allowed non homeowner guarantors to be accepted although they stopped that in early 2012. Their acceptance criteria was also simpler and quite often a deal that didn’t fit with one of the bigger lenders would fit Whitestar Loans.

They lend up to £10,000 for new borrowers.

Central Trust (under the guise of UK credit)

Central Trust are based in Norwich and are a major player in the secured loan space and lend their own money in that sector as well.

They lend up to £3,000 but will go up to £5,000 for existing borrowers if they have conducted their account properly.


TFS Loans

Another independent lender based in Essex, TFS were the first lender to lend up to £5,000, then £7,500 and finally £10,000. They have really grown over the last 3/4 years and are probably just behind Amigo in terms of being the biggest lender out there.


The application process

All of the lenders accept online applications and none of them post out documents anymore. This really helps to speed up the loan process and in the case of Whitestar Loans and Amigo Loans they can often pay the applicant out the same day they apply.

Most guarantor lenders send their documents out via email, both to the applicant (the borrower) and the guarantor and if they also provide the various supporting documents such as ID (usually a driving licence or passport) and proof of their address (if they are not on the electoral roll), then most loans can and will be paid out that very day.

And remember, all loans are now paid into the guarantor’s bank account and that is the same for all of the lenders. Since lenders started doing this, fraudulent applications have decreased to the point that they are almost nonexistent and this is almost entirely down to the insistence of monies being paid to the guarantor.

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