Guarantor for tenants?

Guarantor for tenants?

9:41 AM, 2nd May 2023, About 10 months ago 11

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Hello, If anyone has children in university, they’ll be familiar with the annual signing of the guarantor agreement, promising to pay the rent should your young student fail to do so themselves – and, if you don’t read the agreement carefully, their flatmates rent too.

But, what are the pros and cons of asking for a guarantor for more ‘grown up’ tenants – and possibly even insisting the guarantor be a home owner or, at least, have a mortgage?

The benefits are clear – if the tenant fails to pay their rent, you have someone else who can at least apply pressure on your tenant to pay and, if it comes to the worst, someone else to collect the rent from.

But are there any disadvantages to this?

Clearly, some tenants won’t be able to do this, so you limit the ‘market’ for your property. But are there any other downsides?

Please share your experiences and opinions on this!

Thank you,


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Alan Bromley

10:28 AM, 2nd May 2023, About 10 months ago

I have a student studio apartment in Chester and have had two defaulting tenants since 2016. The property is managed by an investment company that operates in the student lettings market, I won't mention its name.

The first time the guarantor was the student's mother. A little digging seemed to indicate that she lived with her daughter in a rented flat in South London and there seemed little point in chasing her, so I accepted a final payment that covered my outgoings for the academic year.

The second time the guarantor was a monthly subscription guarantor service which I also won't mention. Between them and the letting agent they managed to drag the whole thing out for many months but I did finally get my money. In fact, because the apartment was re-let pretty quickly I ended up with more rent.

Given the choice, I'd insist on the latter guarantor if you're willing to nag them to get your money. That said, I'm in the process of selling my apartment - the student sector's not for me!


11:16 AM, 2nd May 2023, About 10 months ago

If they pass the referencing there is no need for a guarantor as you can get rent guarantee insurance cover

If they don't then don't let to them

Judith Wordsworth

12:05 PM, 2nd May 2023, About 10 months ago

Always sensible to have a property owning guarantor

Yvonne Francis

12:18 PM, 2nd May 2023, About 10 months ago

I've self managed two large student HMO's for over forty years. I have always required house owning parents living within this country to sign a guarantee like the one you described. Very occasionally I make other arrangements. I have never had trouble receiving these documents and never considered it limited my market. I do get lots of applicants for the same house, and I'm in an expensive area, so it's take it or leave it as far as I'm concerned. None of my tenants have failed to pay so no tenant has had to pay another's rent. I have found this system good in every way

David Smith

12:45 PM, 2nd May 2023, About 10 months ago

The guarantor needs to pass referencing.
If they don’t then the prospective tenant does not move in.


15:46 PM, 2nd May 2023, About 10 months ago

Reply to the comment left by Alan Bromley at 02/05/2023 - 10:28
Alan - thanks for this.
Was the Guarantor service different from rental guarantee insurance?
I'm sure people here would like to know who you used that provided such a poor service - there are a lot of providers of insurance out there and personal experience is so helpful when choosing a provider!

Nicholas Grange-Bennett

17:00 PM, 2nd May 2023, About 10 months ago

I am the orginator of rent Guarantee and in 35 years, I have never regretted having insisted on having a guarantor. This does not mean you will get your money and you may well have to take out a further legal action(s) to obtain your rent.
You do not necessarily have have to get a further guarantee document signed each year, provided you have a correctly worded enduring contract of Guarantee. Indeed annual contracts should be avoided, as this provides the guarantor the oppertunity not to sign the new guarantte. You still then have to potentially evect the tenant without the benefit of a guarantee
The market for Rental Guarantee has been decimated, by the effects of Covid and there are only 6 true palyers left in the market. Those that remain, for the most part, are those that insist on thier own refrerencing services are followed. Those contracts offered, after the referencing has been done, will rely on strict rules being followed regarding this issue. Any buyer should pay great attention to these conditions, before taking out the contract, to avoid the claim being repudiated after the event
There are 2 basic forms of cover to look out for. The first is a term of payment, either 3, 4 6 or 12 months from the time of default. The second is limited to the term of the tenacy agreement. This means it is a reducing promise, as a claim in the last month of the tenancy, will result in a legal expenses only service being provided.
I hope this helps

Stuart Parker

11:22 AM, 3rd May 2023, About 10 months ago

Reply to the comment left by Puzzler at 02/05/2023 - 11:16
Why pay more for rent guarantee insurance which surely is a contradiction in terms anyway? Just insist on a homeowner guarantor.


12:20 PM, 3rd May 2023, About 10 months ago

Reply to the comment left by Stuart Parker at 03/05/2023 - 11:22
...and then check with land registry that the guarantor really does own their own house. Unfortunately land registry records are so hopelessly out of date they may not be any use.

Reluctant Landlord

9:12 AM, 5th May 2023, About 10 months ago

Reply to the comment left by Nicholas Grange-Bennett at 02/05/2023 - 17:00
might be good to list those companies still standing and how each of them use which of the two types of cover.

I am going down this route at the mo and finding that RGI is dependent on the what referencing company you use. I havent got as far as looking at the contract basis for cover yet...

What I do know is that Agents are on a pretty penny - many align themselves with an RGI provider but then wont actually offer you this option unless you have a mid or full management package with them.

As I only want a tenant find, I am then limited to the referencing company the Agent uses. Difficult to them get my own separate RGI sorted.

I'd be interested in knowing who uses what RGI company - and what the contracts actually provide in terms of cover, and why you chose them .

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