If you need a loan to buy a bike with a guarantor then our experts can help. If you have little or no credit history then you may find getting a bike loan much easier with the use of a guarantor. We have access to all the lenders who accept guarantors and can quickly provide you with a loan quote from a range of lenders.
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What are Bike loans with a guarantor
Bike loans with a guarantor
Young people, and those who have not had previous loans or credit cards may find that their credit scores prevents them from being able to get a motorcycle loan by themselves. Instead, the lender might offer to take the loan if you have a guarantor. This person assures the lender that you will repay the loan, or the guarantor will take on the debt themselves. Parents, siblings and close friends are usually the people who offer to become guarantors when you want to buy a bike and need a loan to do so.
How do bike loans with a guarantor work?
When you apply for a bike loan, the lender will check your credit history to determine whether you have bad credit, or a poor borrowing history. They may look at your low score, and decide that you are too risky to offer a loan. However, the new fashion for guarantor loans means that you may be offered the chance to take out the loan if you can find someone to co-sign for you. In exchange for their good credit history, you will need to assure them that you are able to repay the loan. The guarantor will then make an application with you, and will sign the loan agreement, taking on the burden of the loan if you fail to repay.
Are bike loans with a guarantor a good idea?
Get the cash to buy your new bike
There are several reasons why choosing to have a guarantor on your loan can be a good idea. Firstly, this is a traditional form of motorcycle loan for younger people, where parents have always been encouraged to co-sign on the loan. Secondly, if you are sure that you are able to repay the loan, then the extra signature on your loan agreement doesn’t mean anything. You will be taking responsibility for the loan, covering the payment of the loan, and using the bike. Thirdly, you will be improving your credit rating by taking on the loan and repaying it fully. This means that, in the future, you should not need to have a guarantor loan.
What are the downsides to bike loans with a guarantor?
As with any kind of loan, you need to be aware that there are downsides to taking out a guarantor loan on your motorcycle. Firstly, the debt, if not repaid by you, can be easily transferred over to the other party on the form. Fail to repay, and your guarantor gets saddled with the whole debt. Before you get the guarantor to consent to the loan, you need to consider whether you will be able to repay the loan, or if you might struggle after a few months. You don’t want to risk placing the guarantor in a position where they are buying something that you have used. In addition, a guarantor loan can have a higher rate of interest than one simply held by yourself.