Bad Credit Loans With a Co-Signer

By Angela Monroe - August 10, 2018

Bad credit loans with a co-signer

It’s always good to ask for help. If you have bad credit and you’re looking for a bad credit loan, applying for loans with a co-signer can have numerous advantages. Think about whether you know the ideal person to be your co-signer and get in touch with us so we can help you find a bad credit loan to suit your needs.

What is a co-signer?

A co-signer or guarantor is a person who will guarantee to be legally responsible for paying back your debt if you (as the borrower) are unable to pay.

The co-signer will have to pay any missed payments or even the full amount of the loan. Co-signers are often family members or close friends.

Why is it easier to get bad credit loans with a co-signor

Having a co-signer means that your lender will have more confidence that the loan will be repaid, even if you are unable to do so yourself.

Co-signers offer extra security to the lender meaning that you may find you are given better loan options than if you did not have a co-signer. This is because the lender is likely to consider you (on your own) as a higher risk.

Generally, if you have a co-signer you will benefit from lower rates on your bad credit loan. This is due to the extra security given by the co-signer.

Things to consider when getting bad credit loans with a co-signer

Firstly, you’ll need to think if there is an appropriate person who can act as your co-signer. Ideal candidates should be in a strong, stable financial position and must have:

  • A good credit rating – they need to be able to prove that if you default on your loan, they will be able to pay it back and they should be able to offer proof through their credit rating of no missed payments or debt themselves.
  • Full-time employment – they should be able to show that they are in full-time employment or have a regular income stream from another source that guarantees they’ll be in a financial position to pay back the loan if you are unable to.
  • Permanent residency – many bad credit loan companies will insist that your co-signer should be an Australian resident.
  • A fixed address – this is important and can be shown through rental payments, housing contracts or proof of ownership.

It’s really important that you also consider the seriousness of the position your co-signer is putting themselves in. When arranging bad credit loans with a guarantor or co-signor, you need to be as certain as possible that you’ll be able to pay it back. Failure to pay back your loan will mean that your co-signer will be financially affected and it could even harm their credit rating.

Speak to the experts

Ask us for advice on getting bad credit loans with a guarantor or co-signer if you’re considering taking this route.

We understand that finding the right loan for you when you have bad credit can sometimes feel like a daunting task. That’s why we want to help you. With years of experience working with people with bad credit, we can help you get a bad credit loan that suits you.

Angela Monroe
Angela Monroe is the Community Manager at The Positive Group, specialising in giving people the information that they need when they need it, and putting you on the path to a fair financial future. She has 8 years of experience in helping Australians find the right finance solutions, and regularly contributes articles to empower Australians with the knowledge they need to become financially healthy.


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