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guarantor credit checking

by CMTJR 19 August 2012 |

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Hi,

My husband and I have decided to act as a guarantor for my sister. I 100% trust that she will and can pay back the loan, so that is not the problem.

I am concerned that as a guarantor, how it will effect our credit rating. Within the last year we have applied and been accepted for a morgage, car finance and car insurance. When we spoke to RBS about taking the loan out on my sisters behalf they said it was unlikely to be accepted as we have to much of a footprint on our credit history.

If we agree to be a guarantor for her through somewhere like Amigo loans, will this still be an issue when they credit check us? When I tried to google the subject it says that they only do a 'soft search' for guarantors but I'm not sure what this means exactly?

Many thanks.

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Comments (3)

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MikeGG1 posted
It should mean that they do a credit check but the amount guaranteed should not count against you for any subsequent check.

The car insurance should not have any effect unless you have borrowed to pay it. If you have then are you sure that you are suitable guarantors?

Mike
Posted on 19 August 2012 | Love 0 loves Report
174

JoeEasedale posted
I am troubled by your assertion that you are 100% sure that she can and will pay back the loan.
The lender is so sure that she won't that they will not lend without your joining in.
Do please be certain that you can afford to repay her loan if called upon to do so, including the arrears and fines imposed before the lender looks to the guarantee., because if you cant, you are putting your new house, and car at risk.
Posted on 20 August 2012 | Love 0 loves Report
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boomtingboom posted
It wont affect your credit rating. It woud only affect your credit rating if she didn't pay and then you was called upon to pay and you refused to pay then it would go to court and everything like that and then it would affect your credit rating.

Getting a loan out for your sister is a good thing because it will improve her credit rating and then she wont need to ask you to guarantor for her anymore because hopefully she will be able to get a loan out from the bank herself or something like that.
Posted on 14 September 2012 | Love 0 loves Report

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