A guarantor loan is unsecured lending backed by a third party. If you miss payments, the lender will approach the guarantor for the arrears. If the guarantor also can't pay, both parties can end up with defaults and County Court Judgments.
There is a large historic mis-selling issue in this market. Where the lender failed to properly assess affordability — either yours or your guarantor's — complaints can lead to refunds of interest and, in some cases, the loan being written off.
If you're struggling with a guarantor loan, tell your guarantor immediately. Free debt help can look at whether affordability was properly assessed and whether a complaint is worth pursuing before any collection escalates.
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