Often those who do not have a paycheck or a demonstrable fixed income , such as a pension, could be required to apply for a personal loan guarantee from banks and financial institutions. Let’s find out what is meant by this term and how personal loans work with guarantor.
Who is the guarantor
In the specific case of personal loans with guarantor, this figure is represented by a person who takes over the loan in the event that the applicant does not have the possibility to meet the commitment undertaken. The characteristics of this figure may vary depending on the requirements specifically requested by personal loans with guarantor, but it is usually required that it has a demonstrable fixed income and a financial profile deemed reliable, ie that it is not, for example, reported to the central risks such as bad payer or protested.
The role of guarantor in online or traditional personal loans can be taken by anyone, without the necessity of a degree of kinship with those who request the loan. Very often the guarantor is in any case a relative or a cohabitant of the applicant, even if in fact nothing forbids to exercise the role of guarantor in the loans even to those who have no family relationship.
When the guarantor intervenes on personal loans
Please note that the guarantor is bound to the loan, but that his intervention is required only in exceptional cases, for example if the person who has taken out the loan is unable to pay one or more installments of the loan or if a situation occurs permanently compromises the possibility of coping with personal loans.
If the person requesting the loan does not have a stable income or in any case its ability to meet the expected installments is unlikely, it is possible that the financial institution or the bank suggests that it is the guarantor to apply for the loan directly. In this case, particular attention must be paid to the effective repayment capacity of the loan by the guarantor.
As regards the signing of the loan, it is required that the guarantor present the documentation , which is normally composed of identity documents and documents that certify the income , such as payroll, pension slips or the Unico model for self-employed workers.
Costs and characteristics of personal loans with guarantor
A personal loan with online or offline guarantor does not have very different characteristics compared to a loan without a guarantor . However, the panorama of personal loans is so varied that it is very difficult to determine what the common characteristics of these loans are. However, it should be noted that loans with guarantors usually have lower costs than those issued to specific categories of applicants, such as protestors or bad payers .
Also for this type of loans the most significant parameter to be assessed when choosing the loan is the interest rate APR , which allows to understand the actual cost of the loan.
Before choosing a personal loan with guarantor, we recommend comparing more personal loans to each other, devoting some time to this operation. From this point of view, an online loan comparator can be very useful, as it allows you to compare different products with each other, entering the required data only once and without having to visit multiple websites. Furthermore, the comparison of loans with guarantors made online could present products of brands other than those best known in the credit sector, but no less convenient or reliable.