To put it simply, in order to reduce the loan risk, banks do not directly give loans to problem users (enterprises or individuals), but ask them to find a guarantee company to guarantee, so as to successfully approve loans. The purpose of this is to transfer the loan risk to the guarantee company and avoid the bank's own bad debt risk. Generally speaking, the business dealings between each bank and the guarantee company are different, and this relationship is based on the fact that the guarantee company must pay a certain margin to the bank. Once the problem borrower defaults, the bank will deduct the corresponding default funds from the deposit account of the guarantee company that provides guarantee services for it. The so-called "guarantee" company plays a role of guarantee at this time to avoid the bad debt risk of banks.
So why should the guarantee company take great risks to provide guarantee services for you? That's because the profits are considerable. In most cases, the guarantee company will take counter-guarantee measures against the borrower, that is, provide you with guarantee services on the premise that the borrower provides real estate, vehicles, trademarks, equity and other collateral as collateral. Of course, there will also be guarantee companies to accept the borrower's application for unsecured loans, but whether it can be successfully handled depends on your personal qualifications.
As far as the cost is concerned, the guarantee company will also charge you a certain percentage of the loan amount, such as service fee or monthly comprehensive management fee. Just like banks, because the policies of each institution are different, the charging standards will be different. Therefore, borrowers need to compare the fees charged by various guarantee institutions.
After reading the above, I believe many people understand the value of guarantee companies. If you can't meet the conditions for a smooth loan from the bank, you may wish to find a guarantee company that can solve the loan problem for you from the "loan consultant" section of Rong360. Of course, if you are not satisfied with the proportion of mortgage loans or the speed of lending, you may get an ideal loan amount with the help of the guarantee company. The reason is that some guarantee companies can handle full or emergency mortgage loans for borrowers.