What is a guarantor?

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A guarantor is a person who helps someone else get credit, a loan, or a mortgage. He or she acts as a guarantor, guaranteeing that they will repay the debt of the borrower if they can’t do so.

Who can be a guarantor?

Anyone can be a guarantor. However, a guarantor is someone who is usually close to you. Someone who knows you very well. It is often a parent, sibling, relative, close friend, or spouse. A person should choose to become a guarantor to someone he or she trusts. Furthermore, a guarantor must be of legal age. He or she must have a good credit history and is financially stable.

Why does someone need a guarantor?

There are several reasons why someone will need a guarantor. Here are the reasons:

  1. The borrower has no credit history, such as a young adult.
  2. They have low income.
  3. They have a low credit score.
  4. They have just started a new job.

Should you agree to become a guarantor?

To agree to become a guarantor, you need to consider these things first:

  1. Why does the borrower need me to become the guarantor?
  2. Does the borrower have the capability to pay his or her debt?
  3. Is he or she responsible and trustworthy?
  4. Does he or she need the loan or is it something he or she could save up for?.
  5. Can you afford to pay the loan?
  6. Would covering the loan change your relationship?

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