With the UK economy still in dire straits many loan companies have either reduced the amount of lending and making borrowing more difficult or have gone out of business completely.
In a market with fewer loan firms and financial products, what were previously niche lenders have now looked at moving into the mainstream.
Most recently Guarantor Loans have seen a surge in popularity over the last few years. Previously they had been a very small percentage of the unsecured loan market.
The basic lending criteria to apply for and get a Guarantor Loan is for the applicant to supply a homeowner or professional (usually a doctor or lawyer) who can act as a guarantor to add additional security for the lender.
Guarantor loans usually allow the borrower to obtain a lower rate of interest than other alternatives such as logbook loans and payday loans. Since the loan company has the additional security of the guarantor and, consequently, have a much better chance of having the money repaid to them they are increasingly more likely to offer competitive interest rates.
Since so many people are still looking for badly needed funding – whether to buy cars on credit, invest into a home business and guarantor loans are proving to be one of the best sources of credit this sector certainly appears to be on the up.
It’s certainly worth bearing in mind that, with more and more guarantor loan lenders entering the mainstream lending market, the competition is hotting up and deals are becoming much more competitive. Creditwindow advises consumers to shop around for the best deal.