Guarantor Loans - Borrower Experience Required

boo_star

The downside of a guarantor loan is the high interest rate.

The upside?

There isn't one. If you don't pay they'll be phoning up the guarantor asking for payment immediately, probably the same day.

Essentially...

If they're a (you're OK with losing) friend ask them to take out a loan in their name which you'll then repay monthly.

If they're a real friend don't ask them to take a loan out at all.

Pixie5740

My advice was not generic and is relevant to you. Right now your finances are a toxic slag heap and it would be cruel of you to drag someone else into them. All it takes is one slip up in your recovery and suddenly your guarantor is liable for a £4k loan with a high interest rate.

Borrowing £4k to repay your current creditors then your debt will not be zero, it will still be £4k except this time someone else will also be liable for it.

If you cannot make this month's repayment of £300 then default and contact your creditor(s) to set up a payment plan you can afford. Leave your friends and family out of this, you cannot borrow your way out of debt.

somethingcorporate

boo_star wrote: »

The downside of a guarantor loan is the high interest rate.

The upside?

There isn't one. If you don't pay they'll be phoning up the guarantor asking for payment immediately, probably the same day.

Essentially...

If they're a (you're OK with losing) friend ask them to take out a loan in their name which you'll then repay monthly.

If they're a real friend don't ask them to take a loan out at all.

They will probably already have the guarantor's bank details and help themselves. They aren't stupid these guys, they fully expect the person taking the loan to default...

CHR15

You aren't asking for someone to support you in your level headed quest to get back on track, you are asking for someone else to take the FULL burden of your previous mistakes off your hands.

Their exposure to this silly debt will affect them when looking for future credit, because THEY are responsible for the whole thing, not you. Nobody expects you to repay it, hence the requirement for a guarantor.

It's been said a number of times but you seem to be reluctant to understand.
If you know anyone crazy enough to agree to this, they should get a much better loan in their own name and hand all the money over to you. It's exactly the same thing but significantly cheaper for both of you.

boo_star

somethingcorporate wrote: »

They will probably already have the guarantor's bank details and help themselves. They aren't stupid these guys, they fully expect the person taking the loan to default...

True, but the guarantor can cancel the DD/CPA (and pay them manually.)

jonesMUFCforever

boo_star wrote: »

True, but the guarantor can cancel the DD/CPA (and pay them manually.)

What will that achieve?

Swift legal action against the guarantor with all the costs added on - yeah really bright idea that (not).

andyfromotley

No NO NOO NOOOOO!!!!!

you are a compulsive gambler. You cannot responsibly put someone else on the hook for your debt. VERY few CG's give up at the stage you are at. Sadly mpst will face years or even decades of fighting to recover from thier addiction.

Your determination not to let your friend down will from experience be swept away in the tide of madness that goes with compulsive gambling.

Please do not do this. its a terrible idea.

Get yourself to GA.
Work out a plan to sort your debts out without lumpimg the liability onto someone else.

BrassicWoman

sparkovic wrote: »

Thank you to the 3 posters above for taking the time to respond. The advice is generic and consistent with other guarantor loan threads on the forum.


However I am trying to get some more information on the solution that I feel would be best for me in the short and long term.

I think your personal judgement has been off for some time so would not go with what you feel.

A small part of your brain is going "spare cash on payday! Bet I can gamble my way out of this.."

You have to fix this yourself, no 3rd parties.

The board has the collective experience of hundreds of yous passing through.

Please listen. Until you stop thinking you are magic and special and different and therefore cured, it won't get better.

Herzlos

sparkovic wrote: »

Sorry but my point is I don't want any impact on the guarantor at all - if they take out a loan it will show on their credit file and I know they may be looking to re-mortgage in the next few months.

The loan will still on the guarantors credit file - they are 100% liable for the debt (it'll be agree with them, and paid into their account, they'll give it to you and hope you'll repay it before landing them with a debt at an interest rate at least 8x the standard UK loan rate now).

If you owe £4k, and were throwing £800-1000 a month on gambling, even you if take a few late payment fees you'll still be able to clear it in 5 months WITHOUT making your friend take out a loan.

Guarantor loans are never a good idea. Literally never.

As said, if your guarantor knows how it works, they wouldn't touch it. It gives them all of the down sides of your bad credit rating with all of the risks of taking out a loan on their side. It's literally lose-lose.