A non-co-applicant loan is a form of credit where the borrower acts as the sole contractor. Thus, the borrower does not include any other person involved in the loan agreement. As a rule, co-applicants are also referred to as guarantors and may be persons of different status. Often co-applicants spouses, family members or good friends are used, whereby with all persons the basic requirement is that also these can have the necessary creditworthiness for the credit.
The use of a co-applicant is thus often used when the original borrower can not have the necessary credit rating to provide the required level of collateral to the lender. A loan without a co-applicant is always worthwhile for borrowers, if no guarantor can be used. This can be the case either because no person can be found who would like to vouch for the borrower or simply the borrower knows no one with sufficient creditworthiness.
Particularly helpful is the credit if you want to make a successful application for credit as a person with a low credit rating. The bank or the lender waive here on the additional requirement to use a guarantor.
Co-applicants are not required
In addition, a loan without a co-applicant is automatically used whenever the borrower himself already has sufficient creditworthiness. However, such borrowers are not looking specifically for a loan agreement without a guarantor, as this is usually a little worse off in its terms than is usually the case for loans. This has to do with the fact that the lender has to compensate for the lack of collateral via an increased interest rate and the loan automatically becomes more costly.
Without a co-applicant to take a loan also has the logical conclusion that the borrower here alone for the repayments of the loan amount and the interest must be liable. If the latter can not meet the required rates, not in full or on time, then he must also expect the resulting consequences. The loan without a co-applicant should only be chosen if there is in fact no sufficient creditworthiness for a commercial loan and actually no guarantor can be found in the inner circle.