Will being a guarantor affect a mortgage applicaion

davidhardy1984

Hello,

My brother has asked me to be a guarantor on a flat for him, however I'm just about to apply for a mortgage mysef and will be going to get a decision in principle in a few weeks. I'm happy to help him out and fully understand the consequences, however if it affects me moving forward then I won't agree.

So, what I really want to know is Will being a guarantor affect the amount I can borrow?

Any advice would be greatly appreciated?

HappyMJ

davidhardy1984 wrote: »

Hello,

My brother has asked me to be a guarantor on a flat for him, however I'm just about to apply for a mortgage mysef and will be going to get a decision in principle in a few weeks. I'm happy to help him out and fully understand the consequences, however if it affects me moving forward then I won't agree.

So, what I really want to know is Will being a guarantor affect the amount I can borrow?

Any advice would be greatly appreciated?

No it doesn't. Nothing appears on your credit report.

My advice in any case is not to do it. I'd lend your brother 5 months rent and along with his deposit and first months rent that he should already have he can pay 6 months rent upfront which now the landlord doesn't require a guarantor as all the rent is paid. Arrange for him to then pay you back monthly over the next 5 months. If you can't afford that don't be a guarantor as your potential liability will be much greater.

If he didn't one day pay the rent you could find yourself landed with a CCJ which definitely will affect a re-mortgage a few years down the line.

Innys1

HappyMJ wrote: »

No it doesn't. Nothing appears on your credit report.

My advice in any case is not to do it. I'd lend your brother 5 months rent and along with his deposit and first months rent that he should already have he can pay 6 months rent upfront which now the landlord doesn't require a guarantor as all the rent is paid. Arrange for him to then pay you back monthly over the next 5 months. If you can't afford that don't be a guarantor as your potential liability will be much greater.

If he didn't one day pay the rent you could find yourself landed with a CCJ which definitely will affect a re-mortgage a few years down the line.

I wouldn't even do the above.

I have an overriding principle - no financial transactions with friends or relatives.

If the OP's brother needs a guarantor, what does that say about their creditworthiness and the chances of the OP being paid back on any loan?

cr1mson

Guarantor for rent or mortgage?

davidhardy1984

Thank you for all the replies.

It is to be a guarantor on a rental property. I've decided against it as he's not proven himself and I don't want to jeopardise my mortgage application/amount I can borrow.

ruggedtoast

davidhardy1984 wrote: »

Thank you for all the replies.

It is to be a guarantor on a rental property. I've decided against it as he's not proven himself and I don't want to jeopardise my mortgage application/amount I can borrow.

I think you made the right decision. Being a guarantor is not really something that people of normal means are meant to sign up to. Its a commitment that goes on for as long as the guarantee remains in the property, and the landlord is under no obligation to evict the tenant if they stop paying. Your losses can be horrendous.