If you need a guarantor loan and are currently self employed then we can help. We have listed all the guarantor lenders who are willing to borrow to self employed people with a guarantor. Some bad and adverse applicants are accepted. Simply click through to the lenders website to apply direct.
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Reasons to use guarantor loans for self employed people
Guarantor loans for self employed people
If you are self-employed, then you will know how hard it is to get a bank loan from any bank or building society. Banks often don’t lend to the self-employed, as running your own small business is seen as a precarious financial situation, and they don’t foresee you repaying your debt. Even business accounts and lenders who are supposed to be friendly towards small businesses may refuse to let you take out a loan. For most small businesses, getting a loan can be the only way to ensure that they can expand and grow their business in order to compete with rivals, or to ensure that they can reach a wider audience. If you have decided that you need a loan, and have not been able to get one from the bank, then you might consider taking out a guarantor loan for self-employed people.
How can a guarantor make such a difference?
The guarantor will be the security for your loan. This person, who trusts you completely, will commit to pay the money you owe in case you default. One of the requirements is that the guarantor has a good credit score and history, and meets the criteria of the lender. Guarantors can be anyone known to you and your business, whether that is friends, family or business partners. This means that the guarantor essentially takes the promise of the loan onto their own shoulders, and you can get the money that you need to help your business. This way the lender provides you with a loan that you would not otherwise have been able to get.
Are guarantor loans too expensive?
Guarantor loans for people with little or no credit history
Guarantor loans are loans aimed for people with poor credit history or people who can’t meet all the major lenders’ criteria for other types of loans. Usually self-employed people fall in the latter category and when they need some cash to inject to the business they find out that their options are very limited. This makes the options available to them very expensive. However, the guarantor loans are the ones which offer lower interest rates compared to other loans such as payday loans, for example, which can charge an APR upwards of 1000%. The interest varies from lender to lender but on average, it is around 50% APR. It is important to note that although this is still a very high percentage compared to the APR of loans where good credit history is a requirement, it represents the level of risk the lender is undertaking when offering the loan and it is still very low compared to payday loans.