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Hi,
I've applied for a car loan, and I've got a guarantor who is willing to sign on my behalf. After receiving the documents for the loan, I noticed that one of the requirements is that the guarantor, who has 2 cars needs to change the insurance information on it and note the finance company as an interested party on his cars. I know that the finance company can ask to be an interested party on the new car I get, but can they be interested parties in the guarantor's cars?

We asked for some advice on your question from a contact within the finance industry. Listed below is their answer based on their understanding of your question.

If a guarantor has been requested then normally the borrower does not meet normal lending parameters. This could be due to the age of the borrower, poor stability, lack of assets, no deposit on the vehicle and therefore higher risk.

If however, the guarantor is also offering additional security, ie another motor vehicle, and the finance company is taking security over that vehicle, then yes they do need to note the finance company as 'interested party'.

If they are not taking additional security then the answer is no - they don't need to be noted as interested party.