Guarantor loans

tipicrow2

Hi, I've been provisionally accepted for a guarantor loan of £2,500 over 3 years at a rate of 47% APR, I want to use it to build my credit as its pretty poor. I have a guarantor in mind, who has an impeccable credit score, so thats not the problem. The pay back is nearly double which is mad but there doesn't seem to be any alternatives. I've been accepted by Bamboo loans, has anyone had any dealings with them? are they a reputable company etc... I know I have to accept the high interest on these types of loans, thats the price you pay for having a rubbish credit score. But just wanted to get some other views before I go ahead. so far I have not affected my credit rating by applying, its been a soft search.
Thanks in advance

sourcrates

You want to take out a Guarantor loan at a whopping 47% interest just to improve a number only you can see ?


Sorry but that is just plain daft, what will you use the money for exactly ?


This type of borrowing has a large failure rate, and the Guarantor ends up been liable, these things tend to not end very nicely, i would strongly advise you to re-think your entire strategy.

System

DO NOT DO THIS. NEVER EVER TAKE ON DEBT JUST TO IMPROVE YOUR CREDIT SCORE. Lenders don't see the score the reference agencies make, they just see the contents of your file. A loan with a sub-prime lender like Bamboo or Amigo Loans can actually DAMAGE your credit record. Mainstream lenders don't like to see sub-prime and pay day loan companies on your credit file.

If you don't pay they'll go for the guarantor for the money. If you want to build your credit history apply for a sub-prime credit card like Vanquis, do normal monthly spending on it and repay the bill every month in full.

oldhand

Fastest way to lose friends and relatives..

tipicrow2

Thanks everyone, I have now decided NOT to get one of these loans, I was a bit dubious which is why I put this post up. You've been very helpful

Nasqueron

People get accepted for these because the firms know that although the borrower will probably default (given that people who borrow from these firms are bad with credit) they can rinse the guarantor who ends up on Can't Pay We'll Take It Away losing their car and then probably visits the borrower with an iron bar and a dental drill

If you want to build your credit RECORD (not the made up score) then get a basic credit builder card from someone like Cap One or Vanquish and spend on it, pay off in full every month, give it a while and get a basic SIM contract with a mobile firm, pay off every month and give it a couple of years and you'll be ok

foxy-stoat

tipicrow2 wrote: »

Thanks everyone, I have now decided NOT to get one of these loans, I was a bit dubious which is why I put this post up. You've been very helpful

Well done. If you want to build your credit history take out a credit card, but your monthly fuel on it and settle the balance every month in full. It should cost you nothing.