Who could be my Guarantor?

Choosing the right person to be your guarantor is essential to increase the chances of your loan being approved.

From the lender’s point of view, having a guarantor with a good credit rating adds a lot of credibility to your application. If your chosen guarantor has a good credit history and trusts you enough to guarantee your loan, then the lender feels they can trust you too.

Guarantor loans are common for those with bad credit scores who have been turned down for mainstream finance from other lenders and banks. So having that reliable and financially sound person involved in your application means that you have a better chance to borrow a guarantor loan of up to £15,000.

The best guarantors to have are:

  • Parents
  • Spouses
  • Siblings
  • Close friends
  • Colleagues
  • Extended family


Someone responsible 

The ideal guarantor must be someone responsible because they are considered a financial back up if the main borrower defaults on their loan. You therefore want to avoid anyone who does not have a stable employment, gambles or has spending issues.

During the application process, the guarantor is required to provide their personal details, proof of income and speak to the lender on the phone as confirmation. So you need someone who is willing to cooperate and be involved in the guarantor loan which could last for as long as 7 years.

Someone with a good credit rating 

One of the biggest factors that lenders consider before funding a loan is whether the guarantor has a good credit history. By having a good credit score, it suggests that the individual has a long history of managing lines of credit and repaying them on time – and this is a big trust signal.

Whilst having a homeowner as your guarantor is ideal, it is not a requirement. We feature a number of lenders that offer tenant guarantor loans whereby the borrower and guarantor can both be tenants and can be approved on other merits.

Other factors that lenders look at include whether the guarantor has other existing loans or owns a car, because they will be used to paying monthly instalments, which mirrors the repayment of a guarantor loan.

Someone with disposable income 

Your guarantor should have some disposable income available and not be living from pay cheque to pay cheque. In the event that they have to cover the cost of your loan, they need some extra income to make repayment without falling into financial difficulty.

Therefore, you will want to select someone that has a good income and does not have any major expenses coming up like those involved with moving home, education fees or a wedding.

Guarantors to avoid 

In terms of guarantors to avoid, you should not choose an individual with a bad credit rating, bankruptcy, IVA or CCJ. This will present a higher risk for the lender and will decrease your chances of being approved.

The guarantor should not be unemployed or on benefits as the lender will prefer someone that has a regular and stable income.

Guarantors should not be based overseas or temporarily living in the UK as this could make it hard for the lender to contact them in the future.

The borrower cannot have a guarantor that they have a joint bank account with, because it means that they are not separate entities and you could have access to their finances.

In addition, you should not get a fake person to be your guarantor or someone without their knowledge. The loan providers we feature will always require proof of identity and a phone call to confirm their details and the terms of the loan.

Other factors will be taken into consideration 

A good guarantor is very important in the underwriting process but there are also other aspects of the application. Applicants must check the lender’s criteria because borrowers must be a certain age, in employment and have a working debit card and mobile phone. Both the borrower and guarantor will undergo credit and affordability checks before their loan can be funded.