For some landlords, the very mention of guarantors can ring alarm bells. But they’re written into more tenancy agreements than you might think, and needing one isn’t necessarily a sign of problems ahead.
Even well-paid professionals with a glowing landlord’s recommendation can fall short in the referencing process, so it’s wise to have an understanding of what it means to have a tenant with a guarantor.
So, in this week’s blog, we’re taking a look at:
Once we’re done, and whenever you encounter a tenant who needs a guarantor - either upfront or after you’ve taken up references - you’ll have everything you need to make a confident decision.
When a tenant doesn’t quite pass the referencing process, the checking agency might still recommend them if they can supply a guarantor.
Regardless of who the guarantor is, it’s essential to fully explain their financial and legal commitment, particularly as some responsibilities (covered next in the blog) can come as a surprise.
While a guarantor will expect to be named on and sign a tenancy agreement, they may not understand all that it means, so it’s up to you to ensure they are fully aware and accept all the terms of the contract.
One thing guarantors are not responsible for, is monitoring how well your tenants are looking after your property, so make sure that you or your managing agent carry out regular mid-tenancy inspections.
More tenants than you might think have guarantors, and using one is no indicator of problems ahead. In fact, a guarantor can offer a valuable extra level of security if a tenant ever hits hard times.
Some of the typical reasons a tenant may need a guarantor include:
Basically, there are plenty of perfectly legitimate grounds for a tenant needing a guarantor that have nothing to do with a lack of reliability or responsibility.
Although referencing a guarantor is similar to referencing a tenant, you’ll need some additional information because of the extra responsibility they are taking on.
So make sure you get:
Once a guarantor passes this process, you’re good to go with adding them to the tenancy agreement, which they also need to sign along with the tenants.
If they fail on any count, we suggest erring on the side of caution and politely saying no. Otherwise, you could invalidate your landlord insurance policy or break the terms of your mortgage.
As with any tenancy dispute, the first resort is to try and resolve matters with the tenant. If you can’t, a guarantor provides another chance to clear things up before resorting to legal action.
Bear in mind that the guarantor could have no idea of the situation (often because the tenant is too embarrassed to say anything). So keep a level head and take the following steps.
Unless there’s a dispute, a guarantor will usually settle things by this point to avoid legal proceedings, but if you do need to escalate things, take a look at our blog on getting your property back.
Do you own a rental property in the Wilton & Salisbury area ?
If you have any questions about guarantors or anything else to do with being a landlord, we’re here to give you answers!
Call us on 01722 580059 or message us at info@piccoloproperty.co.uk for a chat with one of our expert lettings team.
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