The type of loan is getting more and more every day. The new offer comes every time you are looking for a loan at banks or financial institutions. Guarantor loans are kind of new but it becomes a popular one in the UK.
Using the guarantor loan
On the guarantor loan, the loan process will involve the borrower, the lender, and the guarantor who are connected to one and another. The borrower will receive and pay the money to the lender. Then, the guarantor will receive the loan which is funded, in certain cases. Besides that, the guarantor has a choice to give the money to the borrower or change the borrower’s mind and give the money back to the lender. For the lender, his role is giving money and receives money from both the borrower and the guarantor.
The guarantor loan can be seen as the loan with less risk. The loan will make the lender has double chances to get the money back than the standard loan. The loan which is given will be paid by the borrower and the guarantor will do the obligation when the borrower cannot repay the loan. The lender will have two parties that will pay back the loan.