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With certain rental applications, it may be necessary for a tenant, or group of tenants, to require a guarantor to support their rental application.
A guarantor is a representative of a tenant who agrees to co-sign the tenancy agreement and becomes jointly and severally liable for any tenant obligations. Guarantors are only required in the event that one of the named tenants cannot provide acceptable referencing, are of a young age or in receipt of certain benefits.
There are three main factors that affect if someone can act as a guarantor these are:
♦ They must be a UK resident
♦ They must be a homeowner
♦ Their income must be able to cover the costs associated with the rent in the tenancy (for the whole tenancy)
Assuming that these criteria are met then you may be considered as an applicant guarantor. The guarantor will then be subject to full referencing, in the same way as the tenant, before being accepted.
A guarantor will be asked to sign the tenancy agreement along with the tenants and therefore becomes jointly and severally liable with the tenants for all tenant obligations as laid out in the tenancy agreement. This includes payment of the full monthly rent if any of the named tenants default.
The guarantor will remain associated with the tenancy agreement for the full term of the tenancy and for any renewed term unless the tenants are re-referenced satisfactorily and it is agreed that they can be removed from the tenancy agreement and therefore their obligations.
If the property is a shared or student household, a guarantor will be required for each named tenant that is unable to pass acceptable financial referencing. However, in the event of damages, rent arrears or a dispute it is unlikely that a court of law would recognise individual guarantors, and is likely to rule that any tenants and guarantors are jointly responsible in any event. It is critical therefore that tenants are confident that their co-tenants are trustworthy when signing into an agreement for their own sake as well as their guarantor.
We are often asked if we can write into the tenancy agreement that each guarantor will only represent their tenant, unfortunately this is not possible as regardless of what the tenancy agreement states the law in relation to guarantors will be upheld in the event of a dispute. If, as a tenant, you are unable to provide a guarantor who agrees to these conditions the landlord may agree to accept the whole rent for the tenancy in advance or a larger security deposit. If this is not possible, with regret, you will not be able to let a property through Jones Estate Agents.
If you require a guarantor for your tenancy please contact our office to organise the necessary paperwork or apply via our website here. The guarantor will also be provided with a full copy of the tenancy agreement to understand what they are agreeing to.
If you are thinking of acting as a guarantor and have any further questions, then please do not hesitate to contact us directly on 01642 885511.