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Guarantors -
A guarantor is someone who will guarantee to pay the mortgage repayments should the borrower be unable to for any reason.
The guarantor is likely to be a very close friend or a close family member however each lender will have different criteria of who they will and will not accept. Not all lenders will accept a guarantor and those that do will generally only accept a guarantor if the applicant is likely to be able to afford the monthly payments on their own within a relatively short time frame.
Guarantor mortgages are not meant to be for applicants that simply cannot afford the mortgage payments and are never likely to in the future. They are meant for applicants that are likely to have a change in circumstances in the foreseeable future such as a newly qualified Doctor, where their income will increase and they will be able to afford the mortgage on their own.
If applicants cannot demonstrate that this will happen, then the lender will probably decline the application or ask that the guarantor become a second applicant instead.
To qualify as a guarantor their personal income will be verified as though they were the applicants and they must be able to afford their own personal commitments including mortgage repayments in addition to this mortgage repayment.
The reason for this is that the guarantor may possibly be called on to pay the repayments if the applicant should default. Anyone considering acting as a guarantor should carefully consider the consequences and if necessary seek advice .You will not only be responsible for the monthly repayments but also for the debt if the house is repossessed.
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