Am I Out Of Luck?

AdamGeorgeJones

Hi guys first post to the forum :money:

Basically i have to get a new motorbike on finance... however my credit rating is in the red (halfway to be precise) do you think the finance provider (black horse finance) will allow me a guarantor?

Thanks Guys!

pvt

If you cannot afford a loan (which is why a lender will usually refuse it), then you will have to find someone with a good credit history stupid enough to act as your guarantor.

Ironically, although the lender will now have two people to pursue for the repayment of their money, you (or most likely your guarantor) will pay a higher rate of interest for the privilege.

If there is someone who is willing to act as your guarantor then just get them to borrow the money to give it to you - it's far safer for them to do that.

AdamGeorgeJones

the thing is i can perfectly afford the financing however my credit score took a swing as my insurance on my current bike thought it was a good idea to set up the direct debit and take the money 3 days before my payday and whenever i phoned and explained they refused to change the date

MikeyH

pvt wrote: »

If there is someone who is willing to act as your guarantor then just get them to borrow the money to give it to you - it's far safer for them to do that.

It may be cheaper for the proposed guarantor to do that, but safer? In what way?

pvt

MikeyH wrote: »

It may be cheaper for the proposed guarantor to do that, but safer? In what way?

It is safer because the guarantor can make the repayments, and therefore there is no risk his loan will get into arrears.

Whilst lenders will notify a guarantor if payments are missed, and their loan is falling into arrears, that still means they find out after there is a problem.

Just to be clear - I would never suggest anyone act as guarantor for a loan, or loan money to a friend or relative, it's a recipe for disaster. But if someone is hell bent on doing so, then the method I suggest leaves them with the most control of what is going on - and hopefully makes them think twice and not do it in the first place.

Consumerist

AdamGeorgeJones wrote: »

the thing is i can perfectly afford the financing however my credit score took a swing as my insurance on my current bike thought it was a good idea to set up the direct debit and take the money 3 days before my payday and whenever i phoned and explained they refused to change the date

Probably a bit late in the day now but they should give you at least 7 days' notice of the date and amount of the DDs so you had the chance to lodge a formal complaint. Financial institutions have a duty to treat customers fairly and if the date of the DDs was causing you financial hardship you had a good cause for complaint.

DCFC79

AdamGeorgeJones wrote: »

the thing is i can perfectly afford the financing however my credit score took a swing as my insurance on my current bike thought it was a good idea to set up the direct debit and take the money 3 days before my payday and whenever i phoned and explained they refused to change the date

Your credit score didn't take a swing, your credit history was left with an entry.

PaulW922

You are more likely to get a secure loan than an insecured one - your motor dealer may have a finance broker who can assist. Expect a higher rate though. Failing that, as you say, a guarantor may be the way to go - not all finance companies will o that which is why a broker might be a good place to go.

What is important is that you can afford the repayments.

Don't guess at what you can do - take some financial advice from a lender or broker.

I should disregard some of the 'holier than thou' attitudes some posters here seem to have.

AdamGeorgeJones

PaulW922 wrote: »

You are more likely to get a secure loan than an insecure done - your motor dealer may have a finance broker who can assist. Expect a higher rate though. Failing that, as you say, a guarantor may be the way to go - not all finance companies will o that which is why a broker might be a good place to go.

What is important is that you can afford the repayments.

Don't guess at what you can do - take some financial advice from a lender or broker.

I should disregard some of the 'holier than thou' attitudes some posters here seem to have.

Thank you for the advice Paul and everyone else. I am going on Thursday with my guarantor. It will be Honda finance and they have an option to add a guarantor to the application, could it still get turned down even though my guarantor has a good credit score?