Acting as a loan Guarantor

akahomer1969

Hi
Can anyone please help with some information about what safe guards a loan company should take when accepting someone as a guarantor? For instance should they make direct contact with the prospective guarantor or are they just able to accept a signature on a form?

I suspect it’s a very grey area within the consumer credit act so any help would be greatly appreciated.

DCFC79

Are you yourself the guarantor or are you wanting to ask someone ? I take it your aware of the pitfalls of a guarantor ?

akahomer1969

Thanks for coming back to me DCFC79. Luckily its neither I have a friend who has had some problems in the past and I am trying to find out some information as to weather or not a company has acted correctly.

Apples2

Typically Guarantor lenders (e/g FLM) will deposit the loan in the GUARANTORS bank account. It is then up to the guarantor to pass the money over to the person who is going to stop payments on it.

Despite the shouts on here from those silly enough to agree to be a guarantor, they knew perfectly well what being a guarantor meant. It's only when the obvious happens (the borrower stops paying so they take it from the guarantor) that the complaints start.

KingElvis

Basically it means you're going to get shanked by a financial no good.

jonesMUFCforever

I know that banks taking a guarantee to secure a debt used to send the guarantee form to a solicitor of their choice for the details to be fully explained to them.
There used to be a court case where this had to be done for the security to be enforceable.

I don't think the sub prime lenders such as FLM do this - I would investigate whether this has any legal effect - this is unsecured debt.