What You Should Know About Guarantor Loans Same Day

Finding a loan when you have bad credit can be next to impossible. However, by bringing on a guarantor, you can find plenty of lenders willing to loan you money. 

But can you get the funds for guarantor loans same day upon application, or will you have to wait weeks? Find the answer down below. 

What this article covers:

Are There Same Day Guarantor Loans?

Quite simply, a loan with a guarantor is when you borrow money under the premise that a friend or family member can repay the debt if you ever fail to do so. As such, if you ever miss out on a payment or default on your loan, the guarantor will be responsible for covering the outstanding balance.

As you can imagine, being a guarantor on a loan can be pretty stressful. However, sometimes it’s the only way for the lender to agree to the loan.

guarantor loans same day

Typically, a guarantor loan can take a few days until everything is sorted out. However, lenders know that not every person can have the luxury of waiting. That’s why lenders have what’s known as “guarantor loans, same day pay out,” which are small-sized loans for people who are in urgent need of money. 

Generally, loan providers can give out anywhere from $300 to $5,000 almost immediately after they approve a loan application. $5,000 is usually the cut-off point because anything more can be difficult for the lender to have on the go. 

How Long Does It Take for the Loan Funds to Reach You?

Same day loans with guarantor can arrive in your bank account in as little as an hour. In some cases, it can take up to 4 hours or more.

This mostly depends on whether you have the same bank account as your lender. If you do, then the money transfer will take no time. If not, then expect a little lag.

Having a bank account among the four major banks in Australia will help you get a fast fund transfer. Applying to an “instant guarantor loans” online direct lender will also significantly speed up the process. 

Note: Some lenders can take a few days to review and accept your loan application. Accordingly, you need to make sure you’re applying with loan providers known for their speedy loan acceptance. That’s the only way you can get the money on the same day you send your application.

same day loans with guarantor

What Type of Loan Are Guarantor Loans Same Day?

Guarantor loans same day generally fall within the category of payday loans. That’s why you’ll usually hear them being referred to as “guarantor payday loans.” 

In a nutshell, a payday loan is a small loan usually repaid in a year or less. Such loans typically have fixed loan fees rather than an interest rate. However, when the loan exceeds $2,000, an interest rate will be affixed to the loan. 

Note: Guarantor personal loans also exist. However, when they’re for small amounts, they tend to have the same conditions as a payday loan. 

Who Should Apply for Guarantor Loans Same Day?

Guarantor loans are primarily tailored to bad credit clients who’d otherwise have difficulty getting a loan on their own. 

By having a guarantor on your side, lenders will be more willing to sign on with you. That’s because guarantors act as a safety net, decreasing the overall risk for the lender. 

And this isn’t just for bad credit clients. Individuals with insufficient or no credit history will also greatly benefit from having a guarantor. 

When lenders can’t assess your risk due to a lack of history, they’ll be less inclined to approve your loan application. However, having a guarantor, particularly one with good credit, will put the lender’s mind at ease, giving you a nearly 100% guaranteed loan approval. 

guarantor payday loans

Guarantor Loans Vs. No Guarantor Loans

Many wonder whether it’s best to have a loan with or without a guarantor. Well, it honestly depends on your financial situation. 

You see, while guarantor loans may seem like a hassle, they’re actually quite beneficial. With a guarantor, you can get lower interest rates and better repayment terms and conditions. 

On the other hand, a no guarantor loan won’t always be quite so magnanimous. That’s doubly so if you have bad credit. Since lenders will be taking a considerable risk giving you a loan, their loan conditions and interest rates won’t be so forgiving. Still, you won’t be implicating another person in your financial matters, which can’t be said for a guarantor loan. 

So, ultimately, you need to think about what matters to you most when choosing between guarantor and no guarantor loans. 

Pros and Cons of a Guarantor Loan Same Day 

Before getting a payday loan with guarantor, here are some pros and cons to consider: 

Pros 

Cons 

  • May put a family member or friend in debt
  • A guarantor may lose his property if they can’t repay the loan on your behalf
  • A same day loan gives you at most $5,000
  • Defaulting on the loan can damage both your and your guarantor’s credit score 

payday loan with guarantor

How Much Does a Guarantor Loan Same Day Cost?

According to the ASIC, all loans for $2,000 or less can’t have more than a 20% establishment fee and a 4% monthly fee. 

Accordingly, if you borrow $1,000 to be repaid in 3 months, the most you’ll be expected to pay is:

  • Establishment fee: $200
  • Monthly maintenance fee: $120 ($40 x 3)
  • Total: $1,320 
  • Payment on a fortnightly basis: $188.57 (7 payments)

Any lender that tries to charge you more than these fees is breaking the law. So make sure to double-check your loan fees before signing any contract. 

As for guarantor loans larger than $2,000 but smaller than $5,000, loan providers will attach an interest rate capped at 48% p.a. of the principal. The establishment fee for this usually hovers around $400. 

Take care that lenders may charge you late or default fees if you fail to make your payments on time. A single late payment fee can go up to $7 per day, which isn’t cheap. So make sure you never delay or miss any payment; otherwise, you’ll only be making your debt larger.

Can You Remove a Guarantor from a Guarantor Loan?

It’s possible. However, you need to fulfil several requirements before you can do so. 

For instance, you need to give the lender sufficient proof that you can repay the loan on your own. You’ll also need to have been consistent with your previous loan payments for a minimum of 6 months. Any less, and you’ll have a hard time getting the lender to remove the guarantor from the loan. 

no guarantor loans

Eligibility Criteria of Guarantor Loans Same Day

Most loan providers in Australia will give you a guarantor loan provided that you: 

  • Are a citizen or permanent resident of Australia
  • Are at least 18 years of age
  • Have had a steady job for the past three months
  • Have an active bank account, email, and phone number 

How to Apply for Guarantor Loans Same Day

To get a bad credit guarantor loan, you just need to fill out an online application. There, you’ll state your personal information as well as how much money you’d like to borrow. 

The lender will then review your application and call you to confirm your details and get more information. If all is in good order, they’ll send you the loan contract to sign. Once that’s done, they’ll send the money to your bank account. 

Information and Documents Needed for a Payday Loan Application

Most loan applications require that you share the following:

  • A copy of your ID
  • Certain personal details, such as your email, address, and phone number
  • Employment details 
  • Proof of income (payslip or income statement)
  • 90-day history of your bank transactions

loan no guarantor

Alternatives to Guarantor Loans Same Day

If you’ve got bad credit but you don’t want to bring in a guarantor, here are two ways you can still get a loan:

Apply for a NILS Loan

The No-Interest Loan Scheme, or NILS, allows Australians to borrow up to $1,500 without undergoing any credit check. Best of all, this loan doesn’t come with any fees or interest rates. Instead, you just pay back the amount you borrowed over 12-18 months, no more, no less. 

But note that a NILS loan won’t have a same day pay out. So you may need to wait up to a week or more until you get the money. 

Apply for Centrelink Advance Payment

The Human Services Department in Australia allows Centrelink recipients to receive emergency cash loans known as advance payments. 

To be eligible, all you need is to have been receiving any Centrelink government assistance. 

This type of loan doesn’t come with any fees, interest rates, or credit checks. However, its major flaw is that it cuts your income for the coming weeks/months. This may leave you in a hard spot, not being able to pay for your essentials like groceries, rent, utilities, etc. 

Conclusion

Guarantor loans with same day pay out are perfect for bad credit clients who are in urgent need of money.

Sure, you probably won’t be able to find a lender willing to offer more than $5,000. However, you’ll receive the funds in just a few hours, allowing you to take care of your financial issue as fast as possible. 

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