It goes without saying that getting into any kind of financial difficulty isn't fun, and it certainly isn't something that anyone goes into deliberately. With mounting costs and bills sometimes your outgoings just outweigh your income - either on a personal or family level - and you're left with no choice but to seek some kind of financial assistance.

In many cases the obvious solution is to go into the local branch of your bank, asking for either a change to your existing repayments or credit card agreement or for a loan to help you to cover the costs of all your bills. The problem is, even when you are an existing customer of the bank, you're not always guaranteed to get the loan you so desperately need and if you do get turned down because of something like a poor credit history then it can feel like the end of the world - how are you meant to pay your bills now?

Lots of people give up having fallen at the first hurdle and they start to sell off prized possessions like the second family car, maybe a watch or other form of jewellery or electrical appliances that could bring in some money. Before you make such a drastic decision, however, you should investigate the possibility of guarantor loans and whether they might be the answer to your prayers.

This type of loan is usually an unsecured loan, which means that the lender doesn't hold anything of yours as a form of insurance policy should you fail to make the repayments. It is also usually for smaller sums of money - on average ranging between £1,000 and £10,000 which would be paid back over the course of anything from one to five years depending on the lender and your agreement.

The main difference between a guarantor loan and your typical bank loan is that rather than taking your house, car or another item as Ďinsurance', paying off the remaining debt just in case you can't keep up the repayments, they have a second name on the agreement. This person, usually a close friend or family member, signs the agreement to say that they will make any payments that are left over.

For many, guarantor loans become the only option because they've been turned down by their banks or other lenders. The main advantage, other than being significantly different to other loans in terms of interest rates and repayment schedules, is that the guarantor - provided that they have a good credit history - is essentially an endorsement to the lender that the repayments will be made and that helps you to get the loan.

The person would not endorse you if they knew that they would have to pick up the majority (if not all) of the repayments and the lender looks favourably upon that meaning you often get the loan you so desperately need.