Bad Credit Loans & Unsecured Loans

It is always hard to get bad credit loans or an unsecured loan for people with bad credit. Back in 2005 guarantor loans / bad credit loans were dreamt up by James Benamor but many payday lenders had yet to take off. Today guarantor loans are probably the best known bad credit loans for people and with an APR around the same as a credit card they are massively cheaper than typlical unsecured loans and the doorstep lenders. Guaranteed bad credit loans work because despite being a type of unsecured personal loan they have an element of security which the lenders like and this enables them to pass on lower rates of interest.

The security is not a traditional asset like a home or a car but rather another person who has good credit, owns a home and is typically between 23 and 70.

The concept of guaranteed bad credit loans means that the borrower is not means tested with a credit check neither does their situation affect their approval in anyway. Guarantor loans are often known as a bad credit loan or an unsecured loan because it just does not matter one jot what the borrowers situation is, a guarantor loan is foundered on trust.

If a person trusts the borrower enough to act as the guarantor for it (and therefore take responisbility for it) then that is good enough for the guarantor loan lender. Not only does it buck the trend of recent times with banks radically increasing their lending criteria it crushes the idea that unemployed people and people with bad credit cannot get loans. Not only can they do it but they can use the unsecured guarantor loans as a vehicle for breaking the bad credit cycle. By just being able to get the loan and repaying it on time and in full every month the borrower can repair his credit rating where previously he was stuck unable to get the credit he needed to prove to the banks they were back on track and a responsible borrower.

Today unsecured guarantor loans are often one of the first ports of call for people with bad credit looking for unsecured loans. While it is not easy to find a guarantor it is a lot easier and cheaper than many of the bad credit loans alternatives, particularly the payday lenders who often charge APRs well in excess of 10 times more. So they are cheaper, they allow people to help their friend or loved one and they give people access to credit that otherwise