How can we protect the guarantor of a loan?
the principal borrower is out of the picture but he is not yet paid from the loan he have. now, my husband is obliged to pay for him because he is the guarantor. his salary is not enough for us and he is not finish from his previous loan too. there will be nothing left for us if the lending company started to deduct the payment of the borrower from his salary. how can we make the borrower pay his unpaid loan and secure my husbands income?
Introduction to How to Protect the Guarantor
There are two types of loans when it comes to the level of security the lenders have secured and unsecured loans. The main difference between these two types is the fact that people who are not home owners or do not have something that can act as a guarantee and can only take out unsecured loans. However, an unsecured loan sometimes needs a guarantee of some sort, and this is why there are guarantor loans. These are a type of unsecured loan where people find someone who guarantees that they will pay the money back to the lender in case the people who take out the loan do not.
How to Protect the Guarantor
Generally speaking, finding a guarantor is never an easy or a particularly pleasant task, but it is a necessary task to be done by people who need to take out an unsecured loan. In most cases, the guarantor is a parent or a close friend and the guarantor should always have a close relationship with the borrower. When the guarantor knows the borrower well enough, the risks involved are generally significantly lower. Another important thing to mention is the fact that there are several different types of insurance that the borrower can take out in order to ensure not only himself or herself, but also the guarantor.
So the guarantor must understand the burden they are taking on, and even though it is not them taking out the loan, the burden could still fall on them should the repayments fall behind. It can be an extremely scary thing to be a guarantor. Things that make it scary are, if you have an applicant that has a horrible history of making payments on things or if they've lost their job. Finding out stuff like this is vital. You need to find out if your applicant has a bad history of making month-to-month payments. Because, you may end up finding that this is a regular happening with your applicant, and you do not want that on you! Hopefully, you know all of these things before committing to a person to become their guarantor.
In conclusion, it is important to mention that the guarantor is responsible for paying back the loan in case the borrower fails to do so. Owing to this fact, it is of extreme importance that the guarantor is familiar with all the terms of the Guarantor Loans and that the guarantor makes sure that the borrower will pay back the loan without any problems, in order to lower the level of risk involved.
by clonjaz6 years ago
I would check out your local Credit Union. It would probably be your best bet.
by jan536 years ago
Is there anywhere to get an unsecured personal loan for consolidating debt?
by clonjaz6 years ago
The last thing you need is another loan. Please search for "Dave Ramsey" and follow his baby steps program.
by pompeyno16 years ago
Will being a guarantor for a family member on a rented property effect my motgage application
by skagra3 years ago
What is best best to get your money back from the borrower ?When someone needs money he came to you like sweat little pet but at the time when you ask he said I don't have money, or what you will if don't give you back,...
by MikefromNJ7 years ago
Good DayHere is my situation.I live in NJ.I brought a home 2 years ago.I have no equity in my home ,since my property value went down.I am looking for a unsecured home improvement loan to replace my boiler and hot water...
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