Amigo Guarantor receives loan

meer53

Chas54 wrote: »

Hi I am new to this forum.
I volunteer for a debt advice charity and have recently come across a situation which is new to me and my colleagues. Basically the client took out an Amigo loan, it seems that they, Amigo, for “anti fraud” purposes now pay the money to the guarantor, not the client. In this case the guarantor has not passed on the loan and has gone incommunicado. The client however is being pursued by Amigo, whose attitude to this can be best summed up as “not our problem”. Has anyone come across this and has any advice for our client?

If you work with a debt advice charity, why are you asking for advice on this forum ?

System

I'd love to see how Amigo Loans would be able to convince a court they'd given the applicant the money when their records would show it clearly being sent to the guarantor's account. I bet a wiley County Court Judge would have a field day.

[Deleted User]

Pixie5740 wrote: »

Any non-payment would be reported to both the borrower's and the guarantor's credit files.

I don't think it's reported on the guarantors credit file. If you read the Amigo FAQs, the guarantor isn't actually signing a credit agreement so they can't report it to the CRA's.

What they can do is take the guarantor to court if they refuse to pay if the original borrower fails to repay.

Kidder81

The clue is in the first sentence, it's a new situation to them and their colleagues.

Is a forum not the place to ask for help/advice? Was your really constructive comment worth your time?

cjmillsnun

The guarantor has to sign the credit agreement. They are legally bound by it. If they didn’t there would be no way that amigo could go after them. If the loan defaults it would go on their credit file.

[Deleted User]

cjmillsnun wrote: »

The guarantor has to sign the credit agreement. They are legally bound by it. If they didn’t there would be no way that amigo could go after them. If the loan defaults it would go on their credit file.

Absolutely not true. Just read the Amigo FAQs.

The guarantor enters a legal agreement with Amigo but not a regulated consumer credit act one. There will never be anything on their credit record. If the borrower and guarantor both fail to pay, Amigo will take both to court.

PeacefulWaters

camelot1971 wrote: »

Absolutely not true. Just read the Amigo FAQs.

The guarantor enters a legal agreement with Amigo but not a regulated consumer credit act one. There will never be anything on their credit record. If the borrower and guarantor both fail to pay, Amigo will take both to court.

So a guarantor can get a CCJ this way. Which will show on their credit report.

fatbelly

From the T&cs:

https://www.amigoloans.co.uk/loans/terms#gt_precontract

The loan

We will pay you the loan amount for you to pay to the Borrower – this is to prevent fraud

[Deleted User]

The fraud prevention is to stop people pretending to be the guarantor so they can get the loan. If you know enough about a friend it wouldn't be hard to pull off.

The borrower would need to take legal action against the guarantor. Amigo have completed their end of the contract - what happens to the money after that is not their concern (not that I am defending their business model).

Samsung_Note2

Pixie5740 wrote: »

Any non-payment would be reported to both the borrower's and the guarantor's credit files.



If someone has resorted to using a guarantor loan with a horrific APR then (s)he is already about 6 years away from having the type of credit history that makes her or him an appealing prospect to high street lenders.

I will go further and say that someone who resorts to this type of borrowing is probably already on the cusp of a DMP or some form of insolvency anyway. What's one more lender in the mix?



Both parties are legally liable for the debt and Amigo can and will pursue both. It might jolt the guarantor into paying back the money although I suspect that if they're the type of person to steal from a friend/family member then they won't give two hoots about defaulting.

Very helpful post..however id have to disagree regards the underlined...assuming Amigo loans fall into the same area as My Jar/Wonga etc with eye watering % aimed at desperate people,if they are then yes your wrong,i had nearly 100 wonga loans and then 20+ MyJar loans as wasnt working as on ESA.

Maybe 18 months later..credit card and started sorting very poor credit file,ive now got multiple high street Bank accounts (im a switcher for incentives) and have a few High street Credit cards at average %.

So yes they were probably unwise to use Amigo..but didn't mean there credit rating needs to be that dire to be on cup of bankruptcy or DMP.;)