What is the Role of a Guarantor in a Two-Wheeler Loan?

A guarantor is an individual who agrees to take responsibility for repaying the loan if the primary borrower is unable to do so. The role of a guarantor includes:

• Co-signing the Loan Agreement: The guarantor essentially acts as a co-signer, sharing the legal obligation to repay the loan if necessary.
• Providing Assurance: The guarantor assures the financial institution that the loan will be repaid, reducing the institution’s risk.
• Loan Approval: A guarantor’s good credit history and financial stability can increase the chances of loan approval.