What if the borrower stops making the repayments?
With most lenders, once the loan account is up and running, if anything happens (such as the repayment not being made on time) they will contact the guarantor to keep them informed.
The lender will also
- Work with the borrower to try and get things back on track again.
- If that is not possible, for example, if they are unable to get in contact with the borrower,
- They may ask you the guarantor to step in and make the monthly repayments.
This is typically in the best interest of the account for both the borrower and the guarantor to stop arrears building and more serious action being taken further down the line.
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