Guarantor Loans for People with Bad Credit

Representative Example: Amount of credit: £500 for 12 months at £79.09 per month. Total amount repayable of £949.08. Interest: £449.08. Interest rate: 140% p.a. fixed*. 278% APR Representative. Rates between 9.9% APR and 1295% APR.

Guarantor Loans allow you to borrow up to £15,000 and require you to have another person to co-sign your loan agreement and help you cover the cost of your loan if you cannot repay. By having another person as security or ‘back up,’ it gives the lender a lot of confidence that they will be able to receive payments on time.


Guarantor loans are commonly used by people with bad credit histories or no credit histories and having a good quality guarantor, with a good credit rating and income, can give your loan application a lot of credibility and help you get the loan you need.


To apply for a guarantor loan with Badger Loans, start by clicking on ‘apply now’ and enter a few basic details online. You will receive an instant decision or loan offer on the screen and be required to give some information about your guarantor. Subject to further checks of both you and your guarantor, funds can usually be transferred in 24 to 48 hours.

Why Apply for Guarantor Loans? 


For people who have been turned down by mainstream credit providers, they can often feel that there are no options available. Whilst we can use our car or homes as collateral, this can be high risk and sometimes not provide the amount we really need to borrow.


By applying for a loan with a guarantor, you are able to ‘piggy back’ off the good credit rating and affordability of someone close to you – and they can help you get the loan you need.


Especially if your parent, sibling or friend wants to lend you money, but cannot quite afford it, they can still help you by acting as your guarantor.


Your credit score will improve after every successful payment and this can help you access more affordable finance and a wider range of financial products in the future.


What Are Guarantor Loans Used For? 


Guarantor loans are used for a variety of purposes including debt consolidation, paying for bills, starting a business, buying a car, paying school fees or simply to go on holiday. Loans with a guarantor are better for borrowing larger amount and are used for lifestyle purposes, compared to products like payday loans which are better suited for short-term emergencies.

What is The Criteria for The Borrower? 


  • Over 18 years of age
  • UK resident
  • Employed (full-time or part-time)
  • Can afford monthly repayments
  • Valid UK debit account, mobile and email




What is The Criteria for The Guarantor?


  • Over 25 years of age
  • UK resident
  • Good credit score
  • Ideally a homeowner
  • Employed with a stable income
  • Can afford to repay if borrower cannot
  • Valid UK bank account, mobile and email

Who Could Be My Guarantor?


The best guarantors are people that you know well and can speak openly to about your finances. The most approved guarantors with Badger Loans are parents, siblings, spouses, close friends or work colleagues. To maximise your chances of approval, your guarantor should have a good credit rating and being a homeowner, because this indicates that the individual will have a history of making repayments on time and provide a good form of security.


It is noted that your guarantor loan could be as long as 5 or 7 years, so you should find someone that you will likely still be in touch with over this period of time, hence family members are a good option. However, boyfriends, girlfriends and work colleagues can come and go, so it may not be worth committing to a long term loan agreement.



Key Information About Guarantor Loans


How Can I Receive Funds?


Funds can be sent within 24 to 48 hours of approval, but it is noted that the money is sent to the guarantor’s bank account first as security measure and they have a two-week cooling period to send the money back to the lender if they wish to.


Can You Repay Early? 


Yes, you can repay your loan early at any time if you have the means to do so, you can just contact your direct lender. You will often save money by repaying early since you are paying less interest overall.


Is My Guarantor Charged Automatically? 


No, your guarantor is only charged or required to pay for your loan as a last resort. The lender will always contact you first for repayment and offer a grace period before your guarantor is approached for repayment.


Can My Guarantor Exit or Be Changed for Another? 


There is a two-week cooling period once the loan has been funded, but once this has passed and all the papers have been signed, the guarantor cannot suddenly leave the agreement or be swapped for another guarantor. This is because the loan terms are based heavily on the guarantor’s affordability, credit status and ability to repay. The guarantor can be released if the loan term ends or the loan is paid off in full.

Borrow up to £15,000 with the help of a guarantor

Representative Example: Amount of credit: £500 for 12 months at £79.09 per month. Total amount repayable of £949.08. Interest: £449.08. Interest rate: 140% p.a. fixed*. 278% APR Representative. Rates between 9.9% APR and 1295% APR.


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