What is a gaurantor?

A guarantor is a person who agrees to take on the financial responsibility for a loan or contract if the primary borrower or signer is unable to fulfill their obligations. The guarantor essentially acts as a co-signer on the loan, providing additional security for the lender in case the borrower defaults.

Guarantors are commonly used in various financial transactions, such as loans, rental agreements, and credit cards. Lenders may require a guarantor if the primary borrower has a limited credit history, poor credit score, or insufficient income to qualify for the loan.

As a guarantor, you are legally obligated to repay the debt if the borrower defaults, so it is important to thoroughly understand the terms and conditions of the agreement before signing on. Additionally, being a guarantor can impact your own credit score and financial stability, so it is important to carefully consider the potential risks and responsibilities involved.