Loan with a guarantor - what is it and what does it consist of?

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The risk of borrowing money is the same for both parties signing the contract. The consequences of non-payment of debt will be borne by both the lender and the borrower. How do you get out of a situation where you want to retain regular customers and win new ones, despite their questionable creditworthiness? What to do when we need money and no bank wants to grant it to us? The solution to these problems is a loan with a guarantor. It turns out that in addition to winning the lottery and receiving a high inheritance, a salvation for a financial problem is having a guarantor. Let’s find out what changes his signature on our loan agreement.

Loan with a guarantor – how does it work?

Loan with a guarantor - how does it work?

When we hear about a loan with a guarantor, few of us know what a guarantor is. Therefore, it is worth starting by explaining the basic definitions to understand the meaning of this solution. Let’s start with the question, what is a loan? A loan is a transfer of money to one side by another, where the lender undertakes to borrow, e.g. money for a specific time and on certain conditions, and the borrower undertakes to return the amount borrowed in accordance with the contract, the shape and wording of which is governed by the Civil Code.

The loan is granted by a bank or natural persons who conduct business in this area. When taking it, you do not have to specify the purpose for which you need the funds, the lender does not control what the money will be spent on.

Guarantor as collateral for a loan

The loan may be secured by a surety, i.e. a guarantor who will take over our liability in the event of our insolvency. This is a risky solution because neither party can accurately predict what their financial condition will be in the future, but only if the borrower is listed in the National Register of Debtors and has a negative credit history.

Of course, there is still the option of taking a payday loan, however, if the customer already has some commitments or the company has doubts about its credibility, he will probably not be awarded more than a few hundred zlotys.

In the case of payday loans, loan companies do not require security in the form of residents or real estate. It is rather a practice used by banks, although it is also used in a parabank space, e.g. at Rapida Money.

There is no problem if this amount is sufficient for the borrower. Otherwise, it remains to look for alternative solutions, or rather this one: loans with a guarantor.   A loan is a much more serious obligation than payday loan because it involves more than one person and involves larger amounts. On the other hand, a financial institution bears less risk compared to companies offering payday loans , which is why the overall cost of a loan with a guarantor will always be lower. It is worth considering all these factors before submitting the application to the selected lender.

Loan agreement with a surety

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The loan guarantor enables you to receive financial support for people who do not have a perfect credit history if they find a reliable guarantor. It is enough that it demonstrates financial credibility and reliability, and the company turns a blind eye to the presence of the main borrower on BIK or KRD lists. She is not interested in relations between such two clients – the priority is timely repayment, which is likely to happen at least thanks to one of them.

Formalities for a loan with a guarantor

If you want to take advantage of a loan secured by a guarantor, you need to be prepared that the formalities will not be as easy as for payday loans, because more documents should be presented, but the whole procedure is not complicated. The first step is to fill out an electronic application in which the guarantor (guarantor) is indicated. When it is verified (which lasts up to 2 days), the company contacts both the guarantor and the applicant, who should again confirm their willingness to take advantage of the loan with the guarantor and the choice of its amount and repayment time (in KonkretnaKasa it is PLN 2500-25000 and one to three years).

If there are no complications or if either side does not withdraw, a decision to withdraw the money will be made. The transfer should appear on your account within the next 48 hours. In this respect, the speed of response can be compared to payday loans, which reach clients’ accounts at least as smoothly. The similarity also applies to the channels through which formalities are completed – the use of the Internet and telephone significantly speeds up all financial operations.

Who is the guarantor?

GUARANTEE = GUARANTEE = GYRANT person confirming the possibility of settling the obligation contracted by a third party. In the event that, for example, the borrower fails to repay the debt on time, the guarantor is responsible for repayment with all its assets. Any natural person may be a resident if he or she meets the requirements of a given lender . There is no doubt that it should be someone with a good credit history, stable financial standing and age.

Loan guarantee – features of a guarantor

To become someone’s guarantor, several conditions must be met. The guarantor is required to be a Polish citizen who has not yet turned 75. Unlike the borrower, he must demonstrate creditworthiness and, what is extremely important, have a property that provides security for the company in the event that neither the debtor nor the guarantor of the loan have repaid their obligations on time. .

A financial product, which is a loan with a guarantor, like no other, requires honesty and reliability from people using it. To avoid problems during the term of the contract with the loan company, the debtor must inform his guarantor about everything.

We will not encounter such restrictions in the case of payday loans, hence their higher costs – the risk related to the insolvency of the borrower and its guarantor is included in the final loan amount.

If he already has any obligations, he should inform him. Because there is a likelihood of a problem with timely repayment of the loan. Thanks to it, you can settle your current liabilities and improve your financial situation, but you should use this tool carefully and sensibly. The loan company remains quite skeptical about this, as evidenced by the payment of the entire loan amount not to the debtor but to his guarantor. Only he makes the transfer to the account of the actual borrower. So if he did not agree to the loan surety, the debtor would not receive it at all.

Is a loan with a guarantor a guarantee of success?

Is a loan with a guarantor a guarantee of success?

In recent years, we can observe a growing interest of Poles in such financial products as payday loans, social loans or loans with a guarantor.

For more information on social loans, see the SOCIAL LOANS PLATFORM article – WHAT RISK?

Not only banks are trying to tailor their offer to the individual needs of customers – this is a tactic also known to non-banking institutions. They are gradually working on increasing the trust of potential borrowers in relation to their offers, responding to trends in the financial world on an ongoing basis. In this way, we can choose from seasonal loans (for holidays or holidays), enjoy the benefits of loyalty programs and receive discounts on other products. There are so many options that almost everyone will find something for themselves. However, the room for maneuver is narrowed when money is needed by people in debt. That’s when you should consider a loan with a guarantor. It concerns definitely higher amounts than popular payday loans, so it will help you deal with the financial problem faster. It is important to apply only for the amount that you really need. Thanks to this, we will not cause difficulties for ourselves and our guarantor, who is jointly responsible for paying the debt.