Guarantor on a Personal Loan? 5 Risks You Need To Know About

Loans without guarantors are popular but there are still millions who look to guarantor loans. It’s understandable as they look easier to obtain and of course, if you have a friend to in need of help you want to help. However, being a guarantor on a person loan can be a very risky prospect even when you think you know your friend well enough. Here are five risks you really need to know about before being a guarantor.

The Borrower Could Set You Up To Fall

You might be a guarantor to a friend but it might be that your friend never had any intention to repay the money back. Essentially you’re going to be the one to take the fall. Everything bad will happen to you simply because you agreed to take responsibility for the loan if the borrower failed to pay. You were acting as the guarantor to the loan company that the borrower was able to pay back and since they didn’t you have to. That’s why loans without guarantors are so popular as there is none of these risks or hassles.

You Could Be Liable For the Debt – Even Though You Didn’t Receive Any Money

You acted as guarantor and didn’t receive any money but you are the guarantor and that means if the original borrowers don’t pay back the loan you are liable for it. That’s the beauty of loans without guarantors there are no guarantors and no additional burdens to fall on unsuspecting people. Let’s be honest you probably trust your friends and think they won’t leave you to take the burden of the loan on but it can happen. It’s a major risk you need to know.

Your Credit Could Be Affected As A Result Of the Outcome of the Loan

Let’s say the loan wasn’t paid back in full, the burden would fall onto you and that would in turn impact your credit. It doesn’t matter if you pay the loan back or are making arrangements to pay the loan or just refuse to pay; it will affect your personal credit. Guarantors don’t always think or know about this and it causes trouble later. Loans without guarantors don’t need anyone to sign for the borrower but if you have signed, you may find your credit impacted because of it. Check here.

You Might Not Be Able To Get a Personal Loan While the Loan Is Outstanding

In all honesty, you and your credit is attached to the loan and if you go as a guarantor you might find that you personally aren’t able to get the loan you need when the time calls for it. If you’re looking for loans without guarantors but are still a guarantor on another loan until that loan is paid off you mightn’t be eligible for a loan. It’s because of the fact you’re technically liable for another loan and while you aren’t personally receiving the money you’re liable for it and so lenders will be wary of that.

There May Be a Hidden Clause within the Loan Agreement

You are signing to be a guarantor but have you read the entire loan agreement or the parts which relate to the guarantors? Unfortunately a lot of guarantors sign the loan and don’t read anything which is a really bad idea. You don’t know what you’re agreeing too and the defense, ‘I didn’t read the fine print’, aren’t going to work. You need to know what you’re agreeing too. It doesn’t matter if you want loans without guarantors or loans with guarantors, you need to know the risks especially if you’re the guarantor.

Know the Risks

You may love the idea of being a guarantor and helping a friend out but is it really the smartest idea? These loans aren’t terrible but they do come with risks and that is something you really have to be careful of. You have to know the risks in order to avoid them and you never know a guarantor loan might be suitable for you and your friends. Loans without guarantors are of course more popular since there’s no need for guarantors but you have to do what’s best for your needs. Learn more details at: https://www.opalloans.co.uk/loans-without-guarantor

Please follow and like us:

Loans without Guarantors, How You Can Make Them Work for Your Financial Situation

There’s no doubt, loans without guarantors are in great demand. When money is tight, you can often find yourself in need of a loan and that can often cause you a lot of concern. It’s not easy to get a loan without having to have a guarantor on hand to help and even when you do manage to find such a loan, you can still fall into the trap of making your financial situation worse. It happens, more often than you think but it doesn’t have to be that way for you. You can in fact look to a loan without a guarantor and you can make them work for your finances.

Borrow What You Can Afford

First things first, you must understand how easy it can be to get a loan and ruin your finances. The trick to making loans without guarantors work for you is to borrow a reasonable and preferably a sensible amount. It’s absolutely crazy to borrow money you cannot afford to pay back or will struggle to do so. For instance, will you be able to borrow say one thousand dollars and be able to repay that within a year? If so, that might be the limit you stick to. Of course you can borrow as much or as little as you want but it must be an amount you can afford to borrow. Remember, the more you borrow, the more you pay back.

Have Automated Payments Set Up By Your Bank

It’s easy to fall behind on a payment by simply making a late payment or missing one month entirely. For some borrowers they forget they were supposed to make the payment and for others they just don’t get around to doing it. However, missing a payment, even making a payment a few days late, can impact your credit and cause you finances to get into a meltdown. Instead, it’s good to look at creating an automatic payment with the bank so that they initiate payment to the lender on a chosen date every month so you don’t forget to pay. It’s one way to help ensure loans without guarantors work for your finances and that you don’t get in over your head too much. More details.

Use a Good Lender

The key to getting a loan and making it work for your finances is to find a good lender. That’s the secret here – good lenders! Anyone and everyone who wants to look at loans without guarantors really should ensure they are using a good lender. Lenders will make or break your finances and it’s extremely important to ensure you choose a lender you trust and that you feel comfortable with as well. It really makes a huge difference and it’s something you can’t afford to get wrong either.

Make Your Loans Work for Your Finances

Despite what you might believe, it’s very much possible to get a good loan without a guarantor needed and have it do wonders for you! However, you have to do your part in it all and find a lender that is suitable and that offers a good loan too. It’s very important to find a loan without a guarantor that offers you the best for your finances. Loans without guarantors are useful and there are many good lenders to choose from as well. Learn more details at: https://www.opalloans.co.uk/loans-without-guarantor

Please follow and like us: