Guarantor Loan

keithing-ger

My naive sister stupidly agreed to act as guarantor on our younger brothers loan. She has had to pay last couple of months and he is now ignoring calls.

Does anyone have any relevant experience about what options are available to her here? For example court action, refusing to pay herself (does that effect her credit rating?)

Thanks in advance.

Gaz83

keithing-ger wrote: »

My naive sister stupidly agreed to act as guarantor on our younger brothers loan. She has had to pay last couple of months and he is now ignoring calls.

Does anyone have any relevant experience about what options are available to her here? For example court action, refusing to pay herself (does that effect her credit rating?)

Thanks in advance.

What options does she want?

She is legally required to pay the loan. If she doesn't, the loan company can attempt to enforce her to do so, and yes, it will affect her credit rating.

bengalknights

Unfortunatly once you act as guarantor you are literally that, all she can do is pay your brother a visit and get the money off him.

BrassicWoman

she can take your brother to court. Does he have the money to pay up if she does get a judgement against him?

DCFC79

It will affect her credit rating but no1 sees that, the history will be trashed so not a good idea to not pay it.

sourcrates

keithing-ger wrote: »

Does anyone have any relevant experience about what options are available to her here? For example court action, refusing to pay herself (does that effect her credit rating?)

Thanks in advance.

How much is the total debt ?

Essentially she is now the debtor, if the brother cant or wont pay, then they can chase your sister and use every and all means to extract the money from her.

Does she own a house ?

Worst case scenario is she may now be at risk of a county court judgement, a charging order, bailiffs knocking on the door, or attachment of earnings order if she works, i would never ever sign up as a guarantor, ever.

If brother dosent pay, then i would advise her to make some kind of arrangement with them, otherwise she could find herself in a very tricky position.

waamo

These loans tend to be at horrendous interest rates. Can she raise enough money to pay it off? She may even be better off taking out a lower interest rate loan in her own name to pay it.

Work on the assumption you aren't going to see the money from your brother.

Shakin_Steve

I wish people would wise up to the fact that acting as a guarantor means it's actually you who is taking the loan out, not the person who ends up with the money. The loan company can dress it up any way they want to, but the crux of the matter is that if you need a guarantor, you are not creditworthy, and loans are not given to people who are not creditworthy.

Pixie5740

Amigo's webiste has a full page on their website for guarantors and it's not even in small print.

https://www.amigoloans.co.uk/be-a-guarantor

That's the page guarantors have to go to to enter the code emailed to them (not the borrower) by Amigo.

I have no great fondness for Amigo Loans but you can't say that they don't give the guarantor fair warning of what's involved although the fact that someone has had to resort to borrowing money from the likes of Amigo Loans in the first place should be a huge warning that the borrower is !!!!! with money.

MEM62

The only option she has is to continue payments unless and until her brother resumes making them. You sister is lumbered - that is what it means to be a guarantor.

If your sister has good credit standing herself perhaps she could take a loan to clear this one. She will still have a debt but at least she will not be paying an extortionate interest rate.

It's likely to be pointless taking legal action against the brother as you'll be throwing good money after bad.

curty510

my advice would be for your sister to pay off the loan, if she doesn't have the funds, get a loan with her bank and settle it, the interest will be much lower. and then make contact with your brother to pay her back at a rate he can afford.

This loan is not your brothers, it's your sisters im afraid.