Consequences of Taking Out a Loan with Guarantee

If you are in need of a loan but don't have the best credit score, consider borrowing with a guarantee. First and foremost, guarantees increase your borrowing costs. The interest rates  loans with guarantee  typically are higher than those for loans without guarantees. 

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Second, guarantees may not be available for all types of loans. Some lenders only offer them for mortgages and other types of large loans. 

Finally, keep in mind that guarantees do not always protect you from financial disaster. If you don't meet your obligations on the loan, the guarantor can usually wind up footing the bill. 

Financing Your Home or Buying a Car

Here's how you can get one: 

1. Decide what you need the money for. If you're buying a car, make sure the vehicle meets your needs and has the features you want. 

2. Check with your bank or credit union to see if they offer guaranteed loans. Many banks and credit unions have special programs that allow people with good credit ratings to borrow money up to a certain limit without having to undergo a traditional lending process. 

3. Determine your eligibility. Before applying for a loan, make sure you meet all of the lending requirements, including having good credit and being able to repay the loan in full and on time. 

4. Apply online or in person. Most banks and credit unions accept applications online or through their branch offices. 

5. Meet with a representative from your bank or credit union to go over your application and answer any questions.