Guarantor Question

Question

My Dad went guarantor on my car loan. I’ve lost my job and I can’t afford to make the payments on the car; it’s still my debt right? What’s going to happen?

Answer

If you can’t make the payments on the loan, they will pursue your father for payments.  They will generally pursue both you AND your father for the money, under the logic that this increases their chances of receiving some money.

If both you and your father are unable to make payments, options for enforcing the debt include foreclosing on property (the car, other vehicles, houses, shares, etc), garnishing wages (obtaining a court order to take a percentage of your wage), and bankruptcy.

If you need a guarantor, you probably shouldn’t be taking out the loan.  If someone asks you to be guarantor you should have the financial capacity to make payments of the debt otherwise you could end up in serious financial trouble.