There are millions caught between loans without guarantors and loans with guarantors and it’s easy to see why so many are struggling to understand which way to turn with these loans. On one hand, people want guarantor loans because they think they’re easier to get but on another hand, it’s the catch 22 where they need someone to act as a guarantor. It’s not ideal and there are millions who truly don’t know which loans are better for them. So, no guarantor loans VS guarantor loans – which really offers the better solution?
Guarantor Loans Can Almost Guarantee a Lender’s Application
Firstly, when you have a guarantor you can almost ensure you’re going to be accepted for a loan. Now, a lot of people don’t realize that or know it but it can be very important to understand when you’re applying for a loan. Lenders sometimes require security so that their risks are greatly reduced and looking at loans without guarantors there might be a risk for lenders, that’s why guarantor loans are so popular with lenders today.
No Guarantors Help Those Who Don’t Have Guarantors Available
Loans without guarantors are useful when there isn’t anyone to act as a guarantor. If you have the need for a loan but there isn’t anyone to act as guarantor, you can find it almost impossible to obtain one of these loans. By choosing loans that don’t require guarantors you can find they are a little easier to obtain when there’s no one to be your guarantor. What is more, if someone isn’t willing to be your guarantor you don’t have to rely on them and you can save yourself the need to ask someone to be one too.
Guarantor Loans Are Lower In Interest
When you opt for a guarantor loan, you are more than likely going to have a loan that comes with lower interest. Why is that? Well, it’s down to the fact that there is security, there is a guarantor and that essentially means there is a smaller risk for the lender. That can be a very important factor to consider simply because loans without guarantors might have higher interest because there’s no form of security. Higher interest is a problem for many as they can pay back almost double what the original loan amount was.
No Guarantor Loans Don’t Obligate Others Should You Default
What happens if you somehow happen to default on the loan? If you have a guarantor, it will then fall onto them to actually repay the loan even though they didn’t get the money. That’s unfair and it’s certainly a major problem for thousands of guarantors today too. While you might not have any intentions of defaulting, you never know what situation you’ll run into. That’s a real concern and certainly you must think about that before looking at loans with guarantors. Loans without guarantors avoid someone else being on the chopping block because of your defaults.
Make the Smart Choice
Each argument for and against guarantor loans are valid and they should be looked at closely simply because you have to know all sides before making a choice. In a way, guarantor loans might be slightly easier to obtain since lenders have a lower risk but on the other hand, you’re obligating another to take on the burden should you fail to pay. There are two sides of the coin you must understand fully before making a choice. Loans without guarantors are sometimes a better solution for those who don’t have anyone to act as guarantor; think wisely.