What are guarantor loans?
A guarantor loan is a type of loan that requires someone you know to co-sign or guarantee your loan agreement. By doing this they are agreeing to take responsibility your loan if you are unable to make your repayments.
Guarantor loans tend to be for people with a poor credit rating who would struggle getting loans from a bank, building society or mainstream lender. They also tend to be for fairly significant amounts of money, typically £1000-£7000, repaid over a year or more.
Who Is eligible to apply for a guarantor loan?
To apply for a guarantor loan you need to have someone with a good credit rating who is willing to guarantee your loan for you. The loan provider will want the contact details of your guarantor and the guarantor will have to sign a document to say they’re happy to guarantee the loan. So you’ll need to have that discussion with them first!
Who can be a guarantor?
It differs for every company, but generally a guarantor should have a good credit rating. Other requirements could be that they own their own home, have a regular income and of course, that they’re able to afford to make repayments if you are unable to.
It’s worth noting that as part of the application process, not only will you have a credit check carried out by the lender, but your guarantor will also be subject to a credit check. Therefore choosing a guarantor loan is not a small decision. Both you and your guarantor must be committed to the process.
Can I get a guarantor loan from Satsuma Loans?
Here at Satsuma Loans, you don’t need to have a guarantor to get a loan. As a new customer, you could borrow from £100 to £1,000 (subject to affordability) and repay your loan in monthly or weekly instalments on a day of the month or week to suit you. We make sure you only borrow what you can afford to repay, and your loan is managed and maintained online. You’ll know the full cost of your loan upfront, without any hidden fees or charges.
You don’t have to have a great credit score to get a Satsuma Loan. As our loans are for smaller terms and amounts our risk is lower. Try our loan calculator to see if our loans are right for you.
Representative example: £400 loan repayable over 6 months. 6 monthly payments of £126.40. Rate of interest 179% p.a. fixed. Representative 991% APR. Total amount payable is £758.40.