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Asked to be student's guarantor - advice please...
Comments
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From a solicitors blog
"Why do people do it? Why do they sign up for joint tenancies with private landlords together with people they have only just met?
I’m sure it all seems terribly exciting, but what are you letting yourself in for with your shiny new shorthold assured tenancy?
You and all the joint tenants are ‘jointly and severally’ liable for the rent. This means you are each liable for all the rent. If your instant friend stops paying rent, the landlord can come after you for it, even if you have been ‘paying your share’. The Landlord can claim it from you, all the tenants or any of the tenants, whichever option seems to offer the best option of getting the money back. This is entirely legal. Fancy getting a County Court judgement for several thousands of pounds?"
You can read the rest of NearlyLegals blog here:-
http://nearlylegal.co.uk/blog/2007/01/but-i-hardly-know-you/#comments
RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
Read the sticky on the House Buying, Renting & Selling board.0 -
MissMoneypenny wrote: »From a solicitors blog
"Why do people do it? ...
...because they have little option but to do so.
If I were an investigative journalist, this thread would have made me scent a story. The potential ramifications are awful, yet it is widespread practice. The forms scare people witless, yet they still sign them. What is the real scale of the problem? How often are the awful potential outcomes actually reached in practice? How many guarantors have been adversely affected by their charges failing in their duties? Is there a need for more robust legislation (along the lines of the Deposit scheme, for example)? Or is it that the agreement wording just has to be like it is, and the reality is that it is rare for it to be brought into play? (I'm happy for you to regard any/all of these as rhetorical questions!)0 -
This post is intended to set out an interpretation of past events and to be morally neutral and should not be used to try to determine my personal views.
Overal this is part of a general housing problem and is related to the large rise in student numbers (but no rise in the money available to universities to provide accommodation).
The simple fact is that students are high risk Ts so in a pure market they should pay higher rent. However, Ts also have less money so in the past the student rental market has squared this circle by providing low quality housing. (By low quality I mean weatherproof and meeting S11 obligations while using old fittings and a general low standard of decor not property unfit for habitation.)
However, with HMOs and other "advances" in regulation the overall standard of student property has been raised. While raising the standard of property seems to be win win situation it has an unfortunate side effect.
It raises the costs of LLs. Normally rising costs would mean rising rents. However, the rent can not really rise as students income is broadly related to grants / loans (which have been linked to wider inflation which does not take into account housing) so the only possibility to maintain the market has been to lower the risks associated with student lets. The rise of guarantors is the natural response to this.
Of course for students without guarantors (almost certainly poorer students from less advantageous backgrounds) the unintended consequence of increased regulation has been the fact that they have been forced out of the legitimate market.0 -
MissMoneypenny wrote: »From a solicitors blog
You can read the rest of NearlyLegals blog here:-
http://www.google.co.uk/search?q=nearlylegal+blog+joint+tenancy&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-GB:official&client=firefox-a
That takes you to some Google search results.
The actual page is here: "But I hardly know you" (29 Jan 2007)
Their conclusion is "just don't do it", but they don't suggest an alternative idea.
Incidentally, NearlyLegal appears to be a very interesting/useful site (if you are interested in housing law
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That takes you to some Google search results.
The actual page is here: "But I hardly know you" (29 Jan 2007)
Their conclusion is "just don't do it", but they don't suggest an alternative idea.
Incidentally, NearlyLegal appears to be a very interesting/useful site (if you are interested in housing law).
Agreed. If you live your at a small city uni such as the one I'am at (Bangor in Wales) The university can only offer just enough halls places for first year students only and few for second year forcing student into private accommodation(which has the side effect for annoying the locals but that's another story). What the point is complaining about something if your not going to give any suggests to sort the problem.0 -
I've just signed a tenancy agreement for next year.. Joint and several liability with people I've just met. Why? Because university accommodation is ridiculously expensive and restrictive (twice to three times the cost, depending on the maths, and for half the year) and the nice places go quickly. In some places there just isn't a sensible alternative.
My parents have signed a guarantor form. Our landlord says that he would pursue the guarantor of the person who defaults if that happens, but he doesn't have to. I've done my best to choose people who I think are trustworthy, and my parents have to trust me to do that.0 -
...because they have little option but to do so.
If I were an investigative journalist, this thread would have made me scent a story. The potential ramifications are awful, yet it is widespread practice. The forms scare people witless, yet they still sign them. What is the real scale of the problem? How often are the awful potential outcomes actually reached in practice? How many guarantors have been adversely affected by their charges failing in their duties? Is there a need for more robust legislation (along the lines of the Deposit scheme, for example)? Or is it that the agreement wording just has to be like it is, and the reality is that it is rare for it to be brought into play? (I'm happy for you to regard any/all of these as rhetorical questions!)
It gets worse. If your DD moves out in the future and the others stay on, you will be liable for their rent.
Not all letting agents and landlords ask for this. It seems to be something being snuck through by the not so good landlords and LAs. Until the law chnages to stop this type of behaviour, others will follow.
Have you tried looking for a private let or used another LA? Or even ask the local council if they have any good landlords they know of? My daughter found her first house through older students and that LL didn't use an agent. One of my son's friends found his house on newsagents board. There are still some decent landlords out there, the problem is finding them.
It's always worth reporting this problem to your local CAB, MP and Shelter England. It might not help your situation, but Shelter and the CAB are a strong voice and they might be able to get the laws on this tightened up with the next government.RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
Read the sticky on the House Buying, Renting & Selling board.0 -
That takes you to some Google search results.
The actual page is here: "But I hardly know you" (29 Jan 2007)
Their conclusion is "just don't do it", but they don't suggest an alternative idea.
Incidentally, NearlyLegal appears to be a very interesting/useful site (if you are interested in housing law).
Ooops, sorry...I have put the correct link in my original post.
NearlyLegal is a very interesting blog.RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
Read the sticky on the House Buying, Renting & Selling board.0 -
Just to throw my two pennies worth in.....
Yes, if I were a landlord I would definitely ask for the parents of my student tenants to guarantee the rent, for the whole house if possible, and any damage that might be done to the property.
Why? Because I could!
I would also stand a good chance of getting it as well if all the other landlords in the same area were doing the same. And although I'm sure all our offspring are lovely decent people who would never not pay the rent or cause and damage
students are classed as high risk tenants.
As a parent I have managed to reduce my guarantor agreement down to just coving just my sons rent (was originally for the whole amount £1500 a month) but would still be held liable for damages (with no limits) should the worst come to the worst. :eek:
It's easy to say don't sign but not so easy to find an alternative. My son has decided to live with new friends and of course has no idea at this point whether or not it will work out but again choices are limited by cost and availability.
I have a sense of fair play and understand the landlord wishing to protect his income and property but I do object to having to sign up to something which is unfair.
Kinda wish I had enough money to by a five bedroom house quite close to a uni though. :rotfl:0 -
Just to throw my two pennies worth in.....
Yes, if I were a landlord I would definitely ask for the parents of my student tenants to guarantee the rent, for the whole house if possible, and any damage that might be done to the property.
Why? Because I could!
Actually, I hope I'm not being rude but I think that's a little naive.
Consumers want nice predictable contracts. That's why "if you're not completely satisfied bring it back and we'll give you a full refund" is such a popular policy.
Based on the story above, this clause was invoked 7 times in contracts on 1200 properties. Assuming a reasonable 4 people per property that puts the probability of its use at 0.00145. Given that each contract is for about £3000 of services that means the cost per contract of offering the better contract (the one the consumer won't go and have to get legal advice about) is at most £4.375.
The time cost of reassuring each parent that "it's normal" costs more than that - let alone the risk that they find somewhere else and you get left with an empty property (if there is no risk of that, your pricing is wrong). Add to that the fact that you've damaged your commercial relationship with all your customers for about the same money that you spend on toilet paper for your staff.
The real problem is that most student landlords aren't proper businesses. "It's my pension" nonsense prevails so they're also acting like scared naturally-risk-averse consumers instead of businesses.0
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