Guarantor Car Finance

13 Oct 2025

Guarantor Car Finance: What You Need to Know

Securing car finance can sometimes be challenging if you have a history of missed payments, or not much of a borrowing record. That’s where having a guarantor could come in handy. A guarantor could potentially increase your chances of approval if you have a limited or poor credit history, as the lender has a second person to rely on.

Every application is assessed on an individual basis, so approval is never guaranteed by the lender.

What is Guarantor Car Finance?

This type of finance involves another person, usually someone close to you, who is willing to accept responsibility for your monthly payments should they need to. 

If you’re planning on adding a guarantor to your loan application, the process will usually be the same, but having an additional person on the loan can give the lender more confidence. It’s important that both you and your guarantor understand exactly what legal commitments they are agreeing to before signing a contract.

You could potentially use a guarantor when applying for many types of car finance, including HP and PCP finance. 

Guarantor Car Finance for UK Residents: What to Expect

In the UK, you may be able to secure car finance by having a guarantor co-sign your car finance agreement. If this is a route you’re interested in taking, here’s a general idea of what to expect:

1. Application: You apply for your chosen type of car finance through a lender and provide the necessary details about yourself and your guarantor.

2. Checks: The lender will conduct credit and affordability checks on both you and your guarantor.

3. Outcome: Your lender will let you know if you have been accepted or declined for car finance.

4. Repayments: You will make monthly loan payments according to the contract. Your guarantor will only be involved here if you miss a payment.

What Are the Car Finance Guarantor Requirements? 

Although every lender is different, there are usually some common requirements if you want someone to act as your car loan guarantor:

• They must be aged over 21.

• They should have a regular income.

• They will usually need a good credit score.

• They should be UK homeowners (but some lenders don’t require this).

FAQs About Guarantor Car Finance

Can I get car finance with a guarantor?

It is possible that you could get car finance with a guarantor. In some instances, having a guarantor could increase your chances of approval as it is seen as a safety net for lenders. However, not all lenders will accept a guarantor on your loan application.

Can a family member be a guarantor?

Yes, many lenders allow a friend or family member, such as a parent or sibling, to act as a guarantor. The key requirement is that they must meet the criteria of the lender and pass all credit checks.

Can a retired person be a guarantor?

In some cases, a retired person can act as a car loan guarantor. Not all lenders will accept a retired guarantor, but if they do, the person will need to have a stable pension income and meet the affordability checks.

Can a guarantor loan be declined?

It is possible for a lender to decline a car finance application even with a guarantor. This could be for a number of reasons, such as the guarantor not meeting the lender’s criteria or not passing the affordability checks. Every lender is unique, and the criteria will differ, so even if your guarantor meets the criteria for one lender, they may not for another.

Who cannot be a guarantor?

Usually, a lender will not accept a guarantor if they have a poor credit score, no regular income, or an existing financial link to you (like a joint loan, for example). Lenders will need to see that your guarantor can reliably cover monthly repayments if required.

Does a guarantor need to be a homeowner?

Not always. Some lenders prefer guarantors who are homeowners, as it demonstrates long-term stability, but this is not always essential. Non-homeowners may still be accepted if they meet other requirements, such as having a good credit history.

Can I get car finance without a guarantor and bad credit?

Not everyone has someone who can step in as a guarantor. There may still be car finance for bad credit and no guarantor. Some lenders might consider you based on factors such as income and affordability, rather than just your credit score. 

If you don’t have a guarantor, you could also consider putting down a larger deposit, as this can potentially strengthen your chances of approval. You could also work on improving your credit score as a longer-term solution. 

Learn more about financing a car with bad credit. 

Are there any risks for the guarantor?

Acting as a guarantor is a serious financial commitment. If you miss a loan repayment, your guarantor is legally responsible for covering it. This could affect their own credit score and limit their ability to borrow in the future. Because of these risks, it’s important that both you and your guarantor fully understand the responsibilities before signing.

Final Thoughts

Guarantor car finance can be a potential route for drivers who have struggled with credit or have limited credit history. A guarantor to back your car loan may help you to secure approval where you might otherwise have not.

However, it’s important that both you and your guarantor understand the full legal responsibilities and commitments that come with the loan. The lender will outline everything you need to know, but you should always do your own independent research to ensure you understand clearly.

See if you could be matched with one of our lenders, or try out our car finance calculator to get an idea of what your options might be.

 

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Editorial Disclaimer: This content is for entertainment purposes only. Opinions expressed here are the author’s alone, and not those of any bank, credit card issuer, or any other company. This article has not been reviewed, approved, or otherwise endorsed by any of these organisations. NB: The information on this page does not constitute financial advice, please do your own research to ensure that the product/service is right for your individual circumstances.