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  • FIRST POST
    • Lijong
    • By Lijong 18th Jun 17, 12:22 AM
    • 5Posts
    • 7Thanks
    Lijong
    To stand as guarantor
    • #1
    • 18th Jun 17, 12:22 AM
    To stand as guarantor 18th Jun 17 at 12:22 AM
    Hi all
    OK, firstly, Martin Lewis always says never to stand as a guarantor for a loan. However.....

    My son is moving to University in September, 2nd year. He's seen a student house where him and 2 friends are going to be renting for 12 months. As he was in the University's accommodation last year he didn't need this but as this house is private they are asking for a rent guarantor.
    I cannot stand as guarantor I rent myself and am disabled and unable to work through cancer. My wife is my carer. We have nobody we can ask to stand as guarantor. Everyone we know either can't or won't.

    The landlord told him to use a company called Housing Hand who will stand guarantor for him for £300, great you may think but it also asked me to sign as a co-signor and on the application it clearly said THIS IS NOT A GUARANTOR. So I entered my details and received an email.
    They need a copy of my passport, unility bill etc... it goes on to say that if they (Housing Hand) have to pay out for any reason they will look to me the "co-signer" to pay.. Their wording is this copied and pasted............

    "We are currently acting as the UK Rental Guarantor for George XXX.

    George XXX has nominated you as their Co-Signer for the Guarantor Agreement with us. This means that you will be required to co-sign the contract and will be responsible for reimbursing us if we need to pay out as their guarantor.

    You will be sent the Contract in a separate email with instructions on how to sign and return it online.

    As their Co-Signer, we also request that you provide the following documentation. You can upload these files using the link below."

    What's the point in paying £300 for a guarantor for them to chase me if they have to pay out? What are they for? They've also asked for bank statements to prove I work although they say they won't credit check me. I don't work, I am terminally ill. So we don't know what to do.

    Where do we go from here? It is so frustrating when you think you've found a guarantor, elbeit a paid one, and they persue me should they have to pay. So in effect I am guarantoring their guarantor.

    Any advice is appreciated Lijong
Page 2
    • hazyjo
    • By hazyjo 19th Jun 17, 12:44 PM
    • 9,095 Posts
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    hazyjo
    I had no problem signing as guarantor for my son. He worked his back side off to get into UNI. We signed for 3 years and never thought for a moment that we would have to pay for him. We knew he was good with his finances and he knew how to work out his budget each year. He finishes uni this year and just got his first "adult" job and his first flat on his own, no guarantor needed.

    When we singed, it was for our son's share only and there were no credit or employment checks. I think they are more relaxed because most students have plans in place and probably the majority of students do pay.
    Originally posted by Mela322
    As do a lot of people - but the OP is in rented accommodation, terminally ill and not working :/ Bit different...
    2017 wins: Opera tickets; film preview; lipstick; Ideal Home Show tickets + afternoon tea & bottle of Champagne; 2 cases of NKD; notebook; bath rack; books; film Premiere; Broadchurch DVDs; lipbalms
    • teddysmum
    • By teddysmum 19th Jun 17, 3:10 PM
    • 7,799 Posts
    • 4,623 Thanks
    teddysmum
    The loan guarantee company appears questionable, as their only purpose appears to be paying the landlord (possibly) immediately, as they will recover the money from the guarantor, who is in a worse position than if they had guaranteed directly (extra £300 cost ).


    The only people gaining are the company (fee taken) and the landlord who gets his money; hence his recommendation.


    I wouldn't stand as guarantor for family or anyone else (especially the 'else' who you don't even know). We fell foul of a business guarantee when a partner absconded, leaving one person with liability and know about offspring 'borrowing' with promises to repay,too.
    • jamesmorgan
    • By jamesmorgan 19th Jun 17, 3:41 PM
    • 340 Posts
    • 327 Thanks
    jamesmorgan
    In many university towns it is virtually impossible to get student accommodation without someone agreeing to be a guarantor. However, in many cases the guarantor agreement is issued incorrectly so is virtually worthless. I have agreed to over 10 of these for my children over the past few years. Initially I would insert a clause limiting liability to that of my child's annual rent. More recently I have given up doing this and just relied on the agreement being unenforceable in a court of law. Most student landlords have little idea what they are doing. They have all been advised that they must get a guarantor but have no idea how to do it properly. Very few use any form of legal advice. I wouldn't touch a guarantor agreement for a professional tenancy, but student rental is very different.
    • Lord Baltimore
    • By Lord Baltimore 19th Jun 17, 4:24 PM
    • 1,293 Posts
    • 1,277 Thanks
    Lord Baltimore
    My five flat-mates and I would like to thank our guarantor for seeing us through University.
    We don't think we can ever repay you
    all your base are belong to us
    • Lijong
    • By Lijong 20th Jun 17, 1:58 AM
    • 5 Posts
    • 7 Thanks
    Lijong
    Which is great if you can do it. I cant.

    We were told by several landlords and the Uni to use Housing Hands but looking into it further they ask for a co-signer, that co-signer is signing as guarantor.
    So in essence HH pay the LL quickly and pursue the co-signer. They said on Twitter when I asked what they were for .............."co signers don't have to meet the same requirements as a guarantor. e.g. can be from anywhere in the world. Hope this helps"

    I thought, perhaps naively that paying them £300 was a kind of insurance in case he failed to pay rent or damaged the property. What it really is, is a company that pais the LL soon and then comes after the guarantor.

    So still looking into it we're no better off. It's OK to say don't be a guarantor (which I agree with) but what is the alternative. Everyone he's asked if he could pay 3 months rental ahead have said no. He is waiting on a phone call for this house to see if the LL will accept it. The agent doesn't think he will.

    Legally I can't be, I don't know who can be and if this LL declines it I don't know what to do.
    • Pixie5740
    • By Pixie5740 20th Jun 17, 6:35 AM
    • 10,408 Posts
    • 14,252 Thanks
    Pixie5740
    That's poor that the university advised you to use Helping Hands. I don't see what Helping Hands do, other than relieve you of £300, that's any different to you being a guarantor anyway.

    All your son can really do is look for a property to rent where the landlord doesn't require a guarantor or is going back into halls for a second year an option?

    If I were a parent of the other 2 boys I would advise them against signing a joint tenancy with your son. Being a guarantor for a joint tenancy is daunting enough but I'd want everyone's parents (or another relative) to have their head on the chopping block not just some of us. Unless I knew that the Deed of Guarantee wasn't worth the paper it was written then like jamesmorgan I'd just go with it.
    Last edited by Pixie5740; 20-06-2017 at 6:47 AM.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • silvercar
    • By silvercar 20th Jun 17, 8:52 AM
    • 35,294 Posts
    • 148,929 Thanks
    silvercar
    I suspect Helping Hands is of more legitimate use to foreign students, whose parents/ guarantors don't fit the residency requirements to be a guarantor.
    • Mela322
    • By Mela322 20th Jun 17, 6:12 PM
    • 56 Posts
    • 41 Thanks
    Mela322
    I'm really surprised how many are dead set against helping their children when they have worked so hard to get into uni. Whatever happened to trusting your own child?
    • Pixie5740
    • By Pixie5740 20th Jun 17, 7:26 PM
    • 10,408 Posts
    • 14,252 Thanks
    Pixie5740
    I'm really surprised how many are dead set against helping their children when they have worked so hard to get into uni. Whatever happened to trusting your own child?
    Originally posted by Mela322
    Because it's not just your child you have to trust with a joint tenancy.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • Lord Baltimore
    • By Lord Baltimore 21st Jun 17, 12:14 AM
    • 1,293 Posts
    • 1,277 Thanks
    Lord Baltimore
    Because it's not just your child you have to trust with a joint tenancy.
    Originally posted by Pixie5740
    Talking of which Lijong you mentioned your son wants to move in with 2 friends - can either of those provide a guarantor for the tenancy?
    all your base are belong to us
    • Lijong
    • By Lijong 21st Jun 17, 2:45 AM
    • 5 Posts
    • 7 Thanks
    Lijong
    He's pleaded with the LL today and they will accept 3 months up-front as a guarantor. They wouldn't do this last week but if they don't they all walk and he doesn't get his house rented. I'd like this situation to have been guarantoring myself but listening to advice it seems not the best thing to do given he covers the other two students rent too. Obviously health and work-wise I can't but this has been months and everyone he's previously asked have declined his up-front offers. This is the 5th house he's seen, no 6th one this year and finally one's allowed him some grace.

    All sorted now, thanks everyone xx
    • Cheeseface
    • By Cheeseface 21st Jun 17, 6:33 AM
    • 114 Posts
    • 347 Thanks
    Cheeseface
    I'm really surprised that you've managed to find somewhere this close to September. Most of my son's uni friends were searching back in January, and all agreements done by March. I suspect that you may have had less trouble if he'd found a property sooner. I'm pleased that it's sorted now though.
    • csgohan4
    • By csgohan4 21st Jun 17, 7:26 AM
    • 3,493 Posts
    • 2,177 Thanks
    csgohan4
    I'm really surprised how many are dead set against helping their children when they have worked so hard to get into uni. Whatever happened to trusting your own child?
    Originally posted by Mela322


    Never heard of the term money and family shouldn't mix?? Because when it goes wrong, it goes royally wrong. People do silly things when their young, are you happy to pick the pieces and suffer financially?
    "It is prudent when shopping for something important, not to limit yourself to Pound land"
    • silvercar
    • By silvercar 21st Jun 17, 8:07 AM
    • 35,294 Posts
    • 148,929 Thanks
    silvercar
    Never heard of the term money and family shouldn't mix?? Because when it goes wrong, it goes royally wrong. People do silly things when their young, are you happy to pick the pieces and suffer financially?
    Originally posted by csgohan4
    Generally I would agree with you, but given that refusal often means your offspring living in sub standard accommodation with strangers for a year, I would give some leeway in this situation.

    Anyway, I'm glad it has worked out for OP. 2 questions:
    1. Are his housemates also paying 3 months in advance or do they have guarantors. If the latter are their guarantors aware that your son doesn't have one.
    2. Is your son required to pay 3 months in advance though out the tenancy?
    • hazyjo
    • By hazyjo 21st Jun 17, 10:32 AM
    • 9,095 Posts
    • 11,393 Thanks
    hazyjo
    This current thread (http://forums.moneysavingexpert.com/showthread.php?t=5655798) is one reason why many don't want to act as guarantor. Not a case of 'trust' or them 'being good with finances'. Some quit, change course, don't get on with other tenants...


    We see these sorts of threads regularly on the board which is probably why us long-termers know it's right to be cautious.


    Jx
    2017 wins: Opera tickets; film preview; lipstick; Ideal Home Show tickets + afternoon tea & bottle of Champagne; 2 cases of NKD; notebook; bath rack; books; film Premiere; Broadchurch DVDs; lipbalms
    • silvercar
    • By silvercar 21st Jun 17, 11:28 AM
    • 35,294 Posts
    • 148,929 Thanks
    silvercar
    This current thread (http://forums.moneysavingexpert.com/showthread.php?t=5655798) is one reason why many don't want to act as guarantor. Not a case of 'trust' or them 'being good with finances'. Some quit, change course, don't get on with other tenants...


    We see these sorts of threads regularly on the board which is probably why us long-termers know it's right to be cautious.


    Jx
    Originally posted by hazyjo
    One thought, if your offspring ends up with debt like in the post linked above, will you bail them out to avoid them starting their working life with a CCJ? If so, then you have nothing to lose by standing as guarantor.
    • hazyjo
    • By hazyjo 21st Jun 17, 11:34 AM
    • 9,095 Posts
    • 11,393 Thanks
    hazyjo
    One thought, if your offspring ends up with debt like in the post linked above, will you bail them out to avoid them starting their working life with a CCJ? If so, then you have nothing to lose by standing as guarantor.
    Originally posted by silvercar
    I don't have kids, but am guessing I would lend it, not pay it. But only until they were in a position to pay for it out of their student loan (presuming they had one) or they can get a part-time/summer job.
    2017 wins: Opera tickets; film preview; lipstick; Ideal Home Show tickets + afternoon tea & bottle of Champagne; 2 cases of NKD; notebook; bath rack; books; film Premiere; Broadchurch DVDs; lipbalms
    • steampowered
    • By steampowered 21st Jun 17, 12:06 PM
    • 1,390 Posts
    • 1,377 Thanks
    steampowered
    Never stand as guarantor for anyone, money and family should never mix. Often these contracts mean your the guarantor for the whole flat including for the student strangers.
    Originally posted by csgohan4
    Back in the real world, you need to be a guarantor to enable your children to have the ability to rent accommodation at university.

    As well as topping up their student loan - since in many cases it doesn't even cover the most basic living expenses.
    • Mela322
    • By Mela322 21st Jun 17, 12:08 PM
    • 56 Posts
    • 41 Thanks
    Mela322
    This current thread (http://forums.moneysavingexpert.com/showthread.php?t=5655798) is one reason why many don't want to act as guarantor. Not a case of 'trust' or them 'being good with finances'. Some quit, change course, don't get on with other tenants...


    We see these sorts of threads regularly on the board which is probably why us long-termers know it's right to be cautious.


    Jx
    Originally posted by hazyjo
    That is a case of the parent making the choice to move her out of the house. His daughter didn't make that choice.


    And yes, I would be prepared to pay financially. That's my child that needs help, not due to a financial need but a housing need, but I also know my child and completely trust him. And 3 years he showed us that he was still trustworthy.

    To the OP...fantastic update. So happy it all worked out.
    • cjdavies
    • By cjdavies 21st Jun 17, 2:18 PM
    • 2,310 Posts
    • 2,112 Thanks
    cjdavies
    I'm really surprised how many are dead set against helping their children when they have worked so hard to get into uni. Whatever happened to trusting your own child?
    Originally posted by Mela322
    Are you thick?

    Also see this thread: http://forums.moneysavingexpert.com/showthread.php?t=5667557 - nice Son/Brother they have.
    Last edited by cjdavies; 21-06-2017 at 2:20 PM.
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