{"id":157674,"date":"2018-12-18T16:28:46","date_gmt":"2018-12-18T16:28:46","guid":{"rendered":"https:\/\/www.finder.com\/uk\/?p=157674"},"modified":"2026-02-18T15:36:19","modified_gmt":"2026-02-18T15:36:19","slug":"homeowner-guarantor-loans","status":"publish","type":"post","link":"https:\/\/www.finder.com\/uk\/guarantor-personal-loans\/homeowner-guarantor-loans","title":{"rendered":"Compare homeowner guarantor loans"},"content":{"rendered":"

Please note: You should always refer to your loan agreement for exact repayment amounts as they may vary from our results.<\/p>

Late repayments can cause you serious money problems. See our debt help<\/a> guides.<\/p><\/div><\/article>It may be worth considering a homeowner guarantor loan if you’re finding it difficult to obtain a personal loan because of your credit history. A guarantor is a friend or relative willing and financially able to back you and promises to repay the loan if you cannot.<\/p>

With this type of loan, it doesn’t matter whether you (the borrower) are a homeowner, but it does require your guarantor to own their own home or to have a mortgage.<\/p>

These types of loans usually charge a higher interest rate than traditional personal loans because of the perceived increased risk to the lender and the complications of adding a guarantor.<\/p>

What is a guarantor loan?<\/h3>

Someone with a poor credit rating often struggles to obtain traditional personal loans. A guarantor loan is a personal loan guaranteed by a friend or relative \u2013 known as a guarantor \u2013 who usually has a better credit rating and promises to honour any debt if you, the borrower, default on your payments.<\/p>

If the borrower can\u2019t pay the loan, the guarantor takes over the repayments until the loan is paid off.<\/p>

What is a homeowner guarantor loan?<\/h3>

With a homeowner guarantor loan, a borrower with poor or limited credit can obtain a loan by applying with a friend or relative who owns property and promises to step in if the borrower cannot repay the loan.<\/p>

A homeowner guarantor loan requires the guarantor to own their home outright or have a mortgage<\/strong>. Ideally, they shouldn’t be a first-time buyer with only a short period on their mortgage. The loan is not usually “secured” on the property, but the lender generally considers the guarantor, as a homeowner, a safer prospect.<\/p>

The interest rate charged depends on a range of factors, such as the loan amount, the duration and the borrower\u2019s and guarantor\u2019s financial circumstances (including the amount of equity in the property). It is likely to be higher than a mainstream personal loan but lower than a guarantor loan where the guarantor is not a homeowner<\/a>.<\/p>

Late repayments can cause you serious money problems. See our debt help<\/a> guides.<\/div><\/article>

Why take out a homeowner guarantor loan?<\/h3>

If you’re planning a big expense or looking to consolidate an existing debt, you may want to take out a personal loan. However, if your credit score prevents you from accessing most traditional personal loans, then a homeowner guarantor loan could be an option.<\/p>

Asking a friend, family member or work colleague to be a guarantor is a big commitment, and it could impact their credit history or financial situation if you default on your repayments.<\/p>

What should I look for in a homeowner guarantor loan?<\/h3>

When it comes to comparing homeowner guarantor loans, there are some key features to look for. Ask yourself these questions before deciding on a loan.<\/p>