Maybe you received a loan rejection or know you have poor credit. Perhaps you have a startup idea and need a small business loan. Regardless of your situation, an unsecured guarantor loan can seem like the ideal solution.
While these loans are less risky for the borrower, there are still consequences for nonpayment. Learning everything you can about guarantor loans will help facilitate your decision.What Is an Unsecured Loan?
Secured loans are attached to physical assets the loan borrower can use as collateral. For example, a mortgage loan for a house uses the home as collateral. If the borrower fails to repay the loan, the lender can re-sell the home to make up for nonpayment.
On the other hand, an unsecured loan has no attached collateral. The lender thus has a higher risk of not receiving payment fr…