What’s a guarantor loan?

A guarantor loan is a type of personal loan where your loan application is supported by someone else – the guarantor. The guarantor agrees to take responsibility for repaying the loan if you can’t meet monthly loan repayments.
If you’re struggling to get a loan on your own due to a poor or limited credit history, it’s probably because lenders are assessing you as a “higher risk.” Using a guarantor can reduce that risk and mean that lenders are a lot more likely to lend to you. If your guarantor has a good credit rating the lender is likely to approve the loan, even if you have a poor credit history.

Because there’s an additional party involved, the application process is slightly different, but don’t worry, we’ll help you.

At Loanbuzz, we make applying for a loan straightforward.

Simply fill out your contact information, the amount you’d like to borrow, and details about your residential status, income and employment. We’ll find you a lender that’s best placed to help based on your personal circumstances and needs; results will include offers available from guarantor lenders.

If you decide that a guarantor loan might be right for you, here are the basic steps to follow:

  • Click through to the providers site to complete your application.
  • Provide the details of your guarantor. This doesn’t have to be done at the same time as the main application, it can be done later, but it’s a good idea to have the details of your guarantor ready – ideally someone with a good credit history who knows and trusts you.
  • Once yours and your guarantor’s details have been provided, the provider will get in touch to confirm the details are correct. They will then run their credit searches and affordability assessments.
  • The provider will usually speak to both you and your guarantor – and in some cases they could request some additional documentation to confirm some of your details.
  • If all goes well, the loan will be approved, and the money will be paid into your guarantor’s bank account. The guarantor then transfers the money to you. It’s done like this so that the guarantor is fully aware the loan has been finalised.

The repayments you make will depend on your situation and the amount of the loan you go for.
You must be a UK resident over 18 years old to apply.

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What’s the cost of a guarantor loan?

A guarantor loan can be a great way of helping you make a large purchase affordably. When comparing the cost of all loans it’s worth understanding the factors that impact the total amount that you’ll repay – including the annual percentage rate (APR) and any charges.

Here’s some things to look out for, and how Loanbuzz can help:

  1. We show you the actual APR you’ll be charged

    1. Most comparison sites and lenders simply show you a representative APR. However, only some people will get the interest rate as advertised – meaning that a large number of applicants will pay more. At Loanbuzz, we show you the Truerate: a figure including the entire cost of your loan.
  2. We compare loan offers without harming your credit rating

    1. A less-than-perfect credit rating can still be accepted for a loan; however, you might be charged a higher interest rate. At Loanbuzz, we display quotes from lenders that include the true APR you’ll be charged alongside the likelihood you’ll be approved – all without affecting your credit score.
  3. We only work with lenders who offer a fixed interest rate

    1. Some personal loans have variable interest rates, allowing them to change over time. For this reason, if you’re struggling to afford initial repayments, avoid this type of loan. At Loanbuzz, we only display fixed-rate offers, so you know exactly how much you will pay each month until the loan is fully repaid.
  4. We flag up any arrangement fees

    1. Some lenders charge an arrangement fee, which could make a loan more expensive. At Loanbuzz, we’ll always show you the APR and the total amount repayable for each lender (including any arrangement fee, interest and other charges), so you can easily compare the total cost of loans available.

 

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Use our personalised search to find the loan first time

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Take back control of your finances

Simply fill out your contact information, the amount you’d like to borrow, and details about your residential status, income and employment, and we’ll help find a loan that’s truly personal to you.

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Every lender we work with is a reputable company, fully authorised and regulated by the Financial Conduct Authority (FCA). We know they’ll treat you fairly and be transparent.

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What makes us different?

Loanbuzz was designed to help consumers compare loans with confidence. We think the days of showing only headline interest rates that tease users into applying for products they may not be eligible for needs to end. Loanbuzz aims to make it easy to apply for loans by ensuring every product you see is a pre-approved or agreed in principle offer from a lender.

  • We’ll always be straight with you.
  • We’ll always work hard to find a lender for your circumstances, every time.
  • We’ll always show you True Rate offers — you’ll know if you can apply and be successful.
  • We’ll always hold our lenders to a very high standard. All of our lenders are authorised and regulated by the FCA.

  • We’ll never take risks with your personal data - we only share it with our trusted panel of lenders, in order to ensure you find a suitable loan.
  • We’ll never contact you without your permission.
  • We’ll never put loans higher up your results table, just because they’ll earn us more money.