Defined
What Is Guarantor?
A guarantor is someone who agrees to make your car finance payments if you can't. Their good credit can help you get approved, but they're legally on the hook for the full debt.
A guarantor backs your car finance agreement with their own credit and income. If you fall behind, the lender can ask them to pay. It's a way to get approved when your own credit file is thin or poor — but it's a serious commitment for them.
How a guarantor works
The guarantor signs the agreement alongside you and becomes legally responsible for the debt if you miss payments. Their stronger credit reassures the lender, which can unlock approval or a better rate.
Most guarantors are a parent, partner or close relative who owns their home or has a solid credit history. Missed payments can damage their credit, not just yours, so it should never be entered into lightly. See who lenders accept on car finance with a guarantor.
What a guarantor risks
If you stop paying, the lender can pursue the guarantor for the full outstanding balance, and the missed payments hit their credit file too. They're as exposed as you are.
Watch out
Frequently asked
What is a guarantor on car finance?
Who can be a guarantor?
What happens to the guarantor if I don't pay?
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