A friend asked you to guarantee a loan? Or maybe you need a guarantee in exchange for a loan? Making decisions in both situations is extremely difficult. On the one hand – disinterested help to a colleague means that you risk all your life assets, and on the other – the guarantor can definitely increase your creditworthiness, but also lower it when you need cash to finish the property. When can veiling become a bullet? What rights and obligations of the guarantor are worth knowing?
Loan guarantor – a debt surety!
You probably don’t have to be told that you make real friends in poverty. Such a person is a loan guarantor who assumes all financial responsibility for the borrower. This means that in the event of non-payment of debt it is obliged to settle it. Thus, during the surety he risks all his property! It is harder to find a more explicit example of friendly help, in which you credit not only money, but also trust …
So – the loan / loan guarantor is a guarantor or a resident, whose duties and potential threats seem quite dangerous. It is the final solution in a situation where the potential borrower does not have sufficient creditworthiness. However, every situation can be saved! If you approach this, nothing unexpected should happen with a sense of reason and responsibility. Because it is worth noting that the guarantor not only has his duties, but also privileges.
Not everyone can become a guarantor
Can anyone become a guarantor? Well … no. For a bank granting a loan for a high amount – the person securing the debt must have the funds to possibly regulate the loan. Similarly to the applicant, the guarantor is assessed for a thorough analysis of creditworthiness. And as you know, its level of credibility is influenced by many factors: age, education, regularity and source of income, credit history, marital status or being on the “black” list of debtors, etc.
The fact that you guarantee someone a loan is also recorded in the credit system, with the consequence that creditworthiness is reduced. In fact – sometimes so drastic that there is no more talk about other loans! Why? In the eyes of financial institutions, such a person can be held financially responsible at any time, even when the debt is paid on time! However, when you are thinking about making a commitment with a surety, think about the consequences if friendly help will not cause you more trouble than benefits. In addition, from a purely theoretical point of view, a person who can:
- She is 18 years old and runs her own business or is a freelancer,
- He is a pensioner, provided that the age limit is not exceeded – in this aspect, a long-term commitment for a large sum of money, with a senior citizen, is considered rather unfavorably by the bank. Possibly it is connected either with shortening the loan period or with higher monthly installments which effectively lower the creditworthiness,
- It has fixed monthly income, no debts or debt collection activities,
- He has a transparent family situation – when a potential guarantor is married and there is no signed resolution of property, his spouse must agree to participate in the loan! It is also important whether the candidate for a ryrant has children. The best option is – a well-paid, childless single than the breadwinner of a family of several.
A loan guarantee is a great favor and a big loan of trust!
A sensible man who shows a sober view of the world – hardly ever when he takes the risk in favor of someone else’s commitments. Therefore, most often a family member, life partner or close friend decides to be a guarantor. Approach people who are reluctant to guarantee your loan without hesitation. After all, a person who unreasonably accepts any proposal can hardly be called credible and trustworthy …
You should choose the ideal commitment holder from among those you know well and in case of financial problems you know that you will be able to count on their help. After all, unexpected and hopeless situations happen to everyone, and loved ones – if necessary, will cover due payments, without having to participate in court scuffles.