There is a lot of confusion about what a tenant guarantor loan is. The term tenant or non homeowner refers to the loan guarantor status and not the main applicant. This is because most guarantor loan lenders and providers state that the guarantor must own their own home as part of the security requirements.
This means that the guarantor you wish to use must own their own home. They dont need to own it out right, having a mortgage on the property perfectly fine also. Lenders request this as it provides them with further security on their guarantor. However, there are 2 or 3 lenders who now accept tenants and non homeowners as guarantors also which means they rely more on the main applicant, and less of the guarantor. If your guarantor is a tenant then they must have a good to excellent credit rating, be in a full time job and earn above the lenders threshold requirements also. All the lenders require that both the applicant and the loan guarantor are over the age of 18.
Which lenders offer loans with tenant guarantors?
The main two lenders offering these types of loans are UKcredit and Trust Two loans. UKcredit loans have been around for quite some time, while Trust Two loans are new to the market place and also offer a tenant and non homeowner guarantor loan.