What Loan Purposes Are Acceptable?
You can take out your loan for many different purposes, almost anything in fact, including but not limited to the following:
- Home Improvements
- Debt Consolidation
- Business Expansion
- Car/Motorbike/Other Vehicle
- Product Purchases like a a new iPhone
- Medical Bill
Have a chat with us about why you are taking out your loan and we will let you know your options. Some lenders restrict certain loan purposes, such as specific business reasons, however we can let you know exactly what your options are before finalising your loan with the lenders.
What Happens If I Miss A Payment?
If you miss a payment on your guarantor loan then your guarantor will be expected to step in and make the payment on your behalf. This is what makes guarantor loans lenders so flexible, the guarantor acts as additional security.
If you have missed a payment, the lender will usually let the you know and give you time to pay, as opposed to going straight to the guarantor. If you realise you have missed a payment and haven’t heard anything from your lender, CALL THEM. If you can get in touch with them quickly and explain your situation you may be able to avoid them going to your guarantor at all.
Why Do I Need A Guarantor?
If you have good credit, in all honesty you don’t need a guarantor. You only need a guarantor if you have been turned down in the past due to a poor (or lack of a) credit history. By using a guarantor to back up your application you gain access to loan amounts and loan rates that would be otherwise unobtainable.
The guarantor acts as security. If for any reason you are unable to pay back your monthly guarantor loan repayment then the guarantor would be required to step in. This is why lenders are happy to be a lot more flexible when a guarantor is provided to support your application.
Learn more about bad credit guarantor with a guarantor.
Can I Pay Off My Guarantor Loan Early?
Yes, you can pay off your guarantor loan early. This type of loan is not front-loaded which means that your interest will be charged on a daily basis. As soon as you want to pay it off in full, you need to request a settlement figure and interest will be frozen (obviously if you do not settle the debt within a certain period of time, interest will still be charged).
Every lender is different with how they deal with settlements. Amigo Loans have no penalty, you just pay interest up to the day you pay off your loan. However other lenders such as UK Credit will charge you 2 months worth of interest from the day you request a settlement figure. Although even with this additional 2 months of interest you are still saving on interest in the long run by paying your loan with a guarantor off early.
If you need any additional information about paying off your loan early it is worth discussing this directly with the lender you are accepted by before finalising your loan.
Learn more about the specifics of different guarantor loan lenders.
Who Can Be A Guarantor?
We are very flexible with who can be a guarantor. They:
- Can be a Homeowner, Tenant, or Living with Friends/Parents;
- Can be Friends, Relatives or Work Colleagues;
- Need to be between 21 and 75 years old;
- Must have a Good or Fair Credit History.
Will I Be Charged A Fee?
We will never charge you a fee to apply through Talk Loans, from initial application to getting the money in your account you will never have to pay us a penny.
You may wonder how we make money, and the answer is that we are paid by the lenders to provide them with qualified customers. We only get paid once we get you your loan.
This means we work extremely hard to find you a suitable lender, otherwise we would have to shut down!
You do not lose out by applying through Talk Loans; in fact you have a higher chance of getting your loan completed quickly and easily, without having to go around each lender individually.
How Much Can I Borrow?
How much you can borrow depends mainly on the residential status of you and your guarantor, along with the affordability of the repayment each month. Here is a simple table to see how different residential status’ can impact the borrowed amount.
|Homeowner Borrower||Tenant Borrower|
|Homeowner Guarantor||£500 to £15,000||£500 to £10,000|
|Tenant Guarantor||£500 to £8,000||£500 to £8,000|
Note: You can learn more about tenant guarantor loans here.
Other than residential status, the other thing that majorly effects how much you can borrow is the affordability of the loan for both you and your guarantor. In order to understand this we need to look at the monthly repayments of the loan and compare it to your monthly income and expenditure.
Guarantor Loan Affordability
Let’s take an example of wanting to borrow £5,000 over 3 years, which based on our representative APR works out to a cost of £224.64 per month. Let’s say you earn £21,000 per year and take home £1,463.31 per month.
|Monthly Other Costs||£450.00|
|Overall Disposable Income||£213.31|
|Monthly Loan Cost||£224.64|
|Disposable Income after Loan||-£11.33|
As you can see from the example above, this loan is not affordable, in fact it would put you in the red, which could very easily lead to immediate financial difficulty.
Making Things Affordable
Let’s see if we can make this loan a bit more affordable by borrowing a little less over a slightly longer period of time. Let’s go for £4,500 over 4 years, which again based on our representative APR, will work out to £172.93 per month.
|Monthly Other Costs||£450.00|
|Overall Disposable Income||£213.31|
|Monthly Loan Cost||£172.93|
|Disposable Income after Loan||£40.38|
By reducing the loan repayments by around £50, the loan becomes a lot more affordable.
So now we have an affordable loan it is worth understanding how lenders differ in judging affordability. An interesting example is that one lender requires a disposable income after loan a of over £100. While this can be frustrating when it comes to getting your loan completed, we feel agree that this is a good way of budgeting for an emergency.
So through the combination of affordability and residency type you can work out how much you can borrow. If you would like to discuss this with us before making your application, you can give us a call on 01603 391104 during working hours and we will be happy to help.
How Long Will It Take?
While we can often get you your loan very quickly (we have paid out a lot of loans in under an hour from initial application) it does depend somewhat on your personal cicumstances and how quickly we can speak to you and your guarantor.
As well as the time it takes to get hold of the both of you we will also, in some cases, need supporting documents off the both of you. This can slow the application down if they are not easily to hand. Exactly what is needed is based off the level of automated checks that pass.
In a Rush?
To get your loan with a guarantor sorted as quickly as possible here is a brief checklist to consider:
- Have your phone to hand or call us directly on 01603 391104 once you have completed your initial application;
- Ask your guarantor when they will be free so we can call them at a suitable time, ideally straight away;
- Have a recent bank statement or payslip to hand in case we need to see proof of your income;
- Fish out your passport or driving licence in case we need proof of your idenfication;
- Grab a recent utility bill such as a gas or electric bill if you are not on the electoral register as proof of address.
With the above in hand we should be able to sort out your guarantor loan quickly and efficiently. Although in general we would suggest setting your expectations for at least a 48 hours from application, to getting funds in your account.
More Information About This Loan Type
Mon - Thurs: 9:00 to 19:30
Fri: 9:00 to 17:30
Sat: 9:00 to 12:00
61 - 63 Riverside Road
WARNING: LATE REPAYMENT CAN CAUSE YOU SERIOUS MONEY PROBLEMS. FOR HELP GO TO MONEYADVICESERVICE.ORG.UK
Guarantor Loans Representative Example: Borrow £4,000 over 36 months. Monthly repayment of £194.78. Total repayable is £7012.08. Interest payable is £3012.08. Fixed APR of 49.7%. Interest rate of 41%.
Personal Loans Representative Example: Borrow £300 over 6 months. Monthly repayment of £92.43. Total repayable is £554.58. Interest payable is £254.58. Fixed APR of 883.6%. Interest rate of 169.7%.
Talk Loans is a Broker, not a Lender. To operate this service we receive commissions from the lender we refer you to.
Talk Loans is a trading style of Butler Westbury Limited Registered in England No 9035270. Authorised and regulated by the Financial Conduct Authority Reference No. 625156. Registered with the Information Commissioner’s Office ZA090336. Registered office address: 3 Cricket Close, Drayton, Norwich, Norfolk, NR8 6YA