5 Reasons Why People Get Refused A Guarantor Loan

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Getting a loan, any loan, is difficult. But its not impossible as long as you follow certain guidelines and here we will attempt to explain why most people get turned down for guarantor loans by lenders.

1. Some customers do not tell the truth. Yep, hard to believe but some people give incorrect information on their application form for a loan and sometimes it is deliberate. So what constitutes a lie? Is it a dirty great big lie like saying you live somewhere when you dont? Or is a tiny white lie by forgetting to put down details of that mobile phone bill that you didnt pay last month?

The truth is that both of them will be considered by lenders as the customer not being truthful, either knowingly or unwittingly. The silly thing is, it doesnt matter what you put down on the application form as the lender has access to information that tells them all they need to know about your credit history and credit agreements.

So why ask you for details of your credit history? Simple. The lenders ask because they want to see if the information you provide matches up to the information that they have on you and also to see your honesty because it is the easiest thing in the world for a lender to turn someone down who has lied on their application as they will feel you are someone who cannot be trusted.

2. Their guarantor does not qualify. This could be for a number of reasons, not just the fact that they may have a less than perfect credit history. It could be that your potential guarantor has an excellent credit history but they do not own their own home (mortgaged is fine by the way!) or it could be that they are under 21. Either way, make sure your guarantor fits the required underwriting criteria as laid down by the lender.

3. The applicant is not on the electoral roll (sometimes called the voters roll) It is not an absolute tragedy if they are not but then the applicant will have to prove their residency with a utility bill dated within the last 3 months at their CURRENT address.

4. The applicant is in a debt management program such as an Individual Voluntary Arrangement (IVA) or a debt management plan. Being in either one of these will preclude applicants for applying for a loan because (understandably) their income is being managed in a specific way that allows the person to live day to day but also pay their creditors.

5. The guarantor is already party to another loan. This is a difficult one. You may have found the perfect guarantor who has a great credit history, is over 21 and owns their own home but...they are that good a guarantor that they have already agreed to be the guarantor for another loan and as much as any lender would be glad to have them, it is unfair to burden an individual with two loans which is why lenders do not allow it.

About the Author:
Paula Harrison is the owner of the UK's fastest growing guarantor loans provider. You can find out more by visiting http://www.anytypeofloan.co.uk



Article Originally Published On: http://www.articlesnatch.com


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