A guarantor is a person or company that agrees to step in and repay a debt if the main borrower fails to. In business lending, lenders sometimes ask a director or a parent company to act as guarantor so they have someone else to pursue if the borrowing company cannot pay.
How a guarantee works
A guarantor signs a separate legal document alongside the loan agreement. If the borrower defaults, the lender can ask the guarantor to cover the outstanding balance, often up to an agreed limit.
How Credicorp is different
Credicorp lends only to UK limited companies and LLPs, and the loan is made to the company itself. We do not take personal guarantees from directors. That means your personal assets are not pledged against a Credicorp Flex or Slice facility.
- The borrower is the company, not any individual.
- No director personal guarantee is required.
- Always read any guarantee terms in full before signing one with any lender.
Because we sit outside the FCA consumer-credit regime, Credicorp business borrowing is not covered by the Financial Ombudsman Service or FSCS.
See also: A debt collection agency has contacted me - is it genuine?, What is a hard credit search? and What is a novation?.