guarantor loans

barbarawright

If you seriously want opinions from anyone who has direct experience of guarantor loan, do search for threads with FLM in the title and see how many positive opinions you can find. To be fair, I know that people aren't really like to frequent this sort of board if they haven't had problems but at least you see some examples of the sort of problems that come up

http://forums.moneysavingexpert.com/search.php

malkyh

happychick15 wrote: »

i only asked for opinions of those who had experience of them...not some smart a*** comment...think i will take myself off somewhere else...this forum seems to be full of very judgemental ppl

fyi...it wouldnt be something id consider whilst i still have so much debt

See ya.

AlexLeigh

Guarantor Loans are designed for people who can't get a loan through traditional routes such as bank or high street lenders. The rates are higher than what you might expect on a normal loan (which offsets risk for the lender). Typically you can only borrow up to £5k and it helps (although not completely necessary anymore) if your guarantor is a homeowner. Your guarantor would also need a good credit history and have a regular income.

Essentially your guarantor would be as liable to repay the loan as yourself - bear this in mind and make sure your guarantor fully reads the loan documentation if you're thinking about going ahead with one!

Your guarantor would need to sign documentation which binds them into an agreement (this would all be made perfectly clear in the loan agreements), so that if you (as the applicant) have trouble making payments, your guarantor would be obliged to make them on your behalf.

Your location is set to N. Ireland, the only guarantor lenders who lend in that area at the moment I believe are Amigo (http://www.amigoloans.co.uk), who were formally FLM Loans or Guarantor Loans Company (http://www.guarantorloanscompany.co.uk) Others currently only lend to mainland UK.

It's probably worth bearing in mind as well that if you enter debt management or an IVA, then your guarantor would still be liable for payment. The loan wouldn't be written off like a personal loan which is solely in your name.

Hope this helps.

mistersmurf

Perfect timing

I've just been accepted for a mortgage through co-op with my Dad as guarantor. Haven't taken up the offer yet, but have found the flat I want. I couldn't get one, even with a 10% deposit without a my dad, so was my only chance.

What's the consensus on here about guarantors for mortgages?

malkyh

mistersmurf wrote: »

Perfect timing

I've just been accepted for a mortgage through co-op with my Dad as guarantor. Haven't taken up the offer yet, but have found the flat I want. I couldn't get one, even with a 10% deposit without a my dad, so was my only chance.

What's the consensus on here about guarantors for mortgages?

People advise if you actually care about someone, do not ask them to go guarantor for you. If you miss a payment then your father would be stuck with the payments. Families can be destroyed by this.

Janie4Now

Don't!

Just imagine the scenario if you can't pay for some reason. Any reason (you're sick, made redundant, get sued, get made bankrupt....). Imagine having to tell your father. Imagine his reaction. Imagine how awful it will be (then double it).

We are not being judgemental. It doesn't take much imagination to see what it could do to your relationship with your family!

mistersmurf

malkyh wrote: »

People advise if you actually care about someone, do not ask them to go guarantor for you. If you miss a payment then your father would be stuck with the payments. Families can be destroyed by this.

Huh?

THe only reason that could make me default would be if I got sacked from my job (very unlikely) or made redundant (more likely than the first, but still, not hugely likely).

My Dad's not an idiot. He doesn't think he's guaranteeing nothing. He knows he's guranteeing a mortgage, on my flat.

He knows that if either of the options above happen, he'll have to make payments until I find another Job, or sell the flat (hopefully for a very small profit, but maybe not, it could even lose value) so he's fully aware.

We've had weeks of conversation about it, he knows what's involved and he's happy about it.

Is the only bad thing that it may destory our relationship? If so, I'm fairly confident that this isn't going to happen. Could understand that point if I'd tricked him into it, but I genuinely don't see how anyone could trick someone into something like this

malkyh

mistersmurf wrote: »

Huh?

THe only reason that could make me default would be if I got sacked from my job (very unlikely) or made redundant (more likely than the first, but still, not hugely likely).

My Dad's not an idiot. He doesn't think he's guaranteeing nothing. He knows he's guranteeing a mortgage, on my flat.

He knows that if either of the options above happen, he'll have to make payments until I find another Job, or sell the flat (hopefully for a very small profit, but maybe not, it could even lose value) so he's fully aware.

We've had weeks of conversation about it, he knows what's involved and he's happy about it.

Is the only bad thing that it may destory our relationship? If so, I'm fairly confident that this isn't going to happen. Could understand that point if I'd tricked him into it, but I genuinely don't see how anyone could trick someone into something like this

Why ask for opinion if you are just going to get defensive? Huh?

How long is the mortgage?

My mortgage started in 2003. I was employed since 1994. When I took my mortgage redundancies were unheard of in my company. Guess what??

2009 I was made redundant.

mistersmurf

Sorry if I came across as defensive, but all I did was explain my situation a little more, to see if people's advice stayed the same. If you've taken offence to that, I'd suggest the problem lies on your side.

I was just adding more detail. I genuinely wasn't typing in anger/frustration at you, just giving you some background info on the conversation we've had to see if your comment:

"If you miss a payment then your father would be stuck with the payments. Families can be destroyed by this. "

still stands.

If the only problem with a guarantor mortgage is families being torn apart, I think we've done enough ground work to ensure we all know what the score is, so that this wouldn't be a risk.

Sorry again, if you took offense with my post, but please accept I didn't intend any and clearly wasn't being particularly defensive, I was just surprised that your post came across like you thought that we might not both be totally aware of what happens if it goes wrong.

mistersmurf

and one last piece of info which may help explain his decision to agree. He was my guarantor on a student house I rented quite a few years ago, so has done it for me before.

The fact that I didn't miss payments then hasn't fooled him into believing it's not possible now. He is aware there's a chance and wants to do it still.

He can afford to take the mortgage in his name, if he wanted to, but he's not the youngest of chaps and wants me to get in a position so I can support myself when/if I come to apply for my next mortgage. He feels that he may not be here for ever, si I should prove I can repay a mortgage now, to improve my chances next time round