What is guarantor car finance
Motor Finance 4u - Used cars in Tunbridge Wells
Call 01892 822000

What is guarantor car finance?

This form of car finance involves a third party (friend or family) guarantor who agrees to make the repayment on the finance agreement should you fail to make payments. The way in which this finance arrangement works is the initial loan is paid to the guarantor, and the guarantor will release it to you. You, as the borrower, are then responsible for making the repayments on your finance agreement direct to the lender.

How does using a guarantor car finance work?

A guarantor loan works in the same way most other forms of finance do, but in this form of finance, a third party is involved who takes final responsibility for your loan. The main role your guarantor plays in the agreement between you and the lender is essentially, to ensure that the instalments are repaid. Also, much like a personal loan, a guarantor loan gives you the flexibility and freedom of doing what you want with the funds you receive, whether that be to purchase a vehicle as well as insurance and road tax etc. You're free to do as you wish as long as the agreed repayment amounts are met on schedule.

It's important to remember that as there is a third party involved. Should you miss payments on your loan, the third party guarantor will have to pay the instalment on your behalf.

Who may it be suitable for?

A guarantor loan can be better suited to individuals who have a less than perfect credit history. It may also be suitable for people who have had difficulties getting approved for finance in the past.

If you're struggling to build credit, so long as you keep up with the repayments on the loan, to improve your credit score.

Will the guarantor lose their home if I fail to keep up the repayments?

The guarantor won't lose their home if you fail to keep up the payments, however this is not an excuse not to make your payments or be consistently late on making your repayments. As your guarantor is liable for your debt, payment will be obtained from your guarantor and should you both fail to make payments, both parties could be issued a CCJ (county court judgement) which will affect both your abilities to obtain credit in the future.

Does the guarantor need to be a home owner?

Due to the nature of the loan, we'd need your guarantor to be a homeowner. Only in certain circumstances will we consider a non-homeowner, as long as they have been a tenant at the property for numerous years and have an excellent credit history.


A guarantor loan is one way of obtaining finance to purchase a new car should other finance options not be available to you. However it is important that with this form of lending, you carefully consider who you ask to be your guarantor. Not only do you have an obligation to the lender, but to your guarantor too.

Apply Now
Real Loans, Real People Real Loans, Real People.
Get help from one of our
friendly experts today

What our customers say

I just want to say how helpful and friendly all your staff have been, you really have all been a pleasure to deal with and very professional. I can't thank you enough. KR Jessica Townsend

Hi Alex, Thank you very much,  I would just like to say you have been fantastic and we really appreciate all you have done to guide us through the process and help. Many Thanks William.  

Hi Bradley, That's great. Thank you very much for your help. You've been a pleasure to deal with and I wish you all the best for the future mate. KR Roger

Apply Now
5 Points
Your Specialist
Car Finance Company
01892 822000


We Can Call You Back