If you are familiar with what a guarantor loan is then you'll know that unlike a standard unsecured loan there is an additional party in the contract - the guarantor. The guarantor provides a reassurance to the lender that the loan repayments will be made should the borrower be unable to do it.
A guarantor loan can be a godsend in a world where a bad credit history can ordinarily stop you getting credit. But what does this mean for the guarantor? How could a guarantor's credit rating be affected by stepping up to the plate and helping a friend or relation get the credit they need? This video explores this.
So, have you acted as a guarantor for someone? Who were they? How was your credit rating affected by playing this role? How did you feel, and would you repeat the experience? Let us know in the comments below.
Watch more videos about personal finance on our YouTube channel.