Advice needed re: going as guarantor for a friend

takman

Magsnoodle wrote: »

HELP please but please don't judge - there were lots of reasons for my decision - and partly because someone helped me out in a crisis as a 20 year old so it gave me a chance to repay the favour.

Some good advice for the future, being a gurantor for someone isn't really helping them!. Your just subjecting them to a high interest loan when you would have been better to take out a loan yourself at a lower rate and get them to pay you back the money each month.

Like others have said this is still the best option and will save a lot of money in interest. But you really need to sit down with them and agree a repayment plan. Even if it's less than the loan or nothing at all then atleast you can budget for the repayments!.

Joy_Burke

It's a good thing your friend was able to pay for 3 years rather than nothing at all but I do hope you're able to take to her personally. Not just through email or messenger, etc.

You may also want to read this article.

Hope it helps.

Magsnoodle

Dear all

Thank you very much for all your responses. I agree that there have been three years where she has paid the loan back for which I am grateful for. I could have taken a loan out in my name and asked her to pay it back at a proper rate but I felt this was not a good way forward as it would be fully my responsibility to pay it back - at least as guarantor, it was in her name first and foremost.

I also agree that she is obviously in trouble with other stuff as well as finances but as I have moved and don't see her like I used to and this doesn't help with keeping contact.

I had decided that if there was a problem this month and she hadn't paid that I would look to pay it off using a different route. However, having contacted the company this month it had been paid.

I'm going to try and contact her and meet her to discuss what is going on... Thank you all for listening.

Have a great weekend xxx

takman

Magsnoodle wrote: »

I could have taken a loan out in my name and asked her to pay it back at a proper rate but I felt this was not a good way forward as it would be fully my responsibility to pay it back - at least as guarantor, it was in her name first and foremost.

It seems like you don't fully understand how a Guarantor loan works!. The loan may be in her name but it if she doesn't pay they won't be chasing her for payment, they will be chasing you!. It is basically your loan and if you watch "Can't pay, won't pay" you will see the baliffs visiting the Guarantors house and not the house of the person who is taking out the loan!.

Magsnoodle

Hi Takman

Yes I do understand how the loan works but they look to her first and then to me. I will never let it get to the point where the bailiffs are needed. Not my style. Hence why I have a good relationship with the loan company and they contact me now when problems occur. I also know that when I agreed to this there was always a chance that I would be paying back the whole lot and for the five years.

When I agreed to do this, I knew that I could afford to pay it back and my house was not at risk..... Would make life difficult to pay back and reduce some of our lifestyle that we now have but was possible......

Thanks again all xxx

27col

It's quite sad how many guarantors come on here to complain that the loan that they are guaranteeing has been defaulted. They then say they cannot afford to make the payments required,
Thus proving that they had no idea of the nature of being a guarantor.
Not the position of this OP, obviously. But it is the position of many guarantors. Going on the number of posts on the subject.
The mere fact that a prospective borrower needs a guarantor should ring warning bells.

jonesMUFCforever

Years and years and years ago a bank would not take a guarantor without that person been told to sign the form in the presence of their own solicitor who would explain the consequences.

It is high time that legislation was brought in to bring this process back.

DCFC79

jonesMUFCforever wrote: »

Years and years and years ago a bank would not take a guarantor without that person been told to sign the form in the presence of their own solicitor who would explain the consequences.

It is high time that legislation was brought in to bring this process back.

Entirely agree, I bet the number of people agreeing to be a guarantor would decrease if what you describe was in place.