Guarantor Loans in the UK
Guarantor Loans are unsecured loans designed for those that have a bad credit history or non-existent credit history. Such people may have been turned down from their bank or from any such mainstream lender. These loans require a "guarantor" who will step in to take responsibility of the debt should the main applicant happen to default. Guarantor loans are relatively new on the scene with the first major lender (FLM Loans) starting off the trend in 2005. Guarantor loan lenders lend up to £5000 that is usually spread out over a number of years. The interest rates are relatively high, but are much lower than the rates offered from other alternative subprime lenders. These loans are headlined as "no credit check loans", but you should be aware that a credit check is usually carried out for the purpose of verification only. Much of the expectation lies in the guarantor who will be standing in to support the applicant.