What Exactly Does A Guarantor Guarantee When Getting Car Finance?

[rugbyjacks]

We've ordered a new Toyota on finance.

We've got a 35% deposit but have been told we need a Thai guarantor.

All the people we've asked so far were willing but unable to as they were already guarantors for other people.

I want to ask some other Thais but I don't know them quite as well and I'm unsure as to what being a guarantor entails? Can't seem to get a straight answer from the finance guy?....

I originally assumed that they woud be saying they knew me, yes I am who i say I am and yes I work where I say I work but my partner seems to think they would be liable for the payments if we defaulted?!

Surely no Thai who is earning between 20 and 30,000 THB a month is going to sign up to something saying they'll take on payments of 13,000 a month if the farang defaults or buggers off with the car??!!

I'm confused.

Can anyone shed any light on this? Or better yet, suggest a finance avenue that will take a 35% deposit with no guarantor?

Thanks

Jacks

[Farma]

my partner seems to think they would be liable for the payments if we defaulted?!

You partner is correct in my experience. The guarantor is financially responsible if you fail to make repayments or do a runner.

[tom21]

it is the same in Thailand as any other country. As farma said "The guarantor is financially responsible if you fail to make repayments or do a runner"

[steveromagnino]

Offer them an extra 5% and say can you get rid of the guarantor.

Finance companies have ways of internally making this issue disappear. 35% is pushing it, 40% you should be ok.

[naboo]

Offer them an extra 5% and say can you get rid of the guarantor.

Finance companies have ways of internally making this issue disappear. 35% is pushing it, 40% you should be ok.

I got no guarantor with 25% down. Toyota are just not very Farang friendly.

There are ways of increasing the deposit as a percentage by claiming a higher loan amount for accessories then not purchasing the accessories but using the money on the deposit. Or the dealer increasing the interest then using the higher commission to increase your deposit, thus removing the cost of the extra interest.

Where there's a will there's a way. Toyota don't seem keen to sell much though, they know the crowds will buy their cars on brand alone forever*.

_{*what they know isn't necessarily fact.}

Edited May 17, 2012 by naboo

[transam]

If the deposit is upped then a guarantor can be eliminated.

[Tywais]

If the deposit is upped then a guarantor can be eliminated.

As others have said, the guarantor is fully responsible for re-payment if you default. If you have a work permit and bank book showing regular funds coming that can help convince them of payment reliability. Also, maybe find another loan company or see if increasing the down will satisfy them.