Being a guarantor for students

anselld

welnik wrote: »

Thanks for all your replies. I have been forwarded part of the "contract" which makes interesting reading:-

"******** charge an ‘Application Fee’. This fee is to cover the costs of processing your tenancy request and once paid is non-refundable. The cost includes; administration, credit checks, landlord references, employment references and residency checks. Each individual tenant must complete an ‘Application for Tenancy’ and pay the application fee. NB: Where a guarantor is required, this may attract an additional charge"

Now correct me if I am wrong but I thought the new legislation states that all of the above are prohibited under the new act?

Fees are prohibited for new tenancies entered into after 1st June in England. It is probably still legal if the tenancy was signed by all parities before that date and if the fee is specified in the tenancy.

splishsplash

I was guarantor for my kids for a total of 11 contracts. Only one was a joint and several contract, every other time they were in shared accommodation but had separate contracts.

I felt exactly as you did, OP - that these other parents were strangers - and I don't think I slept a night for that year!

It worked out fine, but it could just as easily have been a disaster. I swore that I would never do it again and warned the kids that it was a deal breaker for any future tenancies.

dimbo61

As one of the " moneygrabbing " student landlords each year I rent out our £350,000 six bedroom house to six complete strangers who are 19/20 years old
I require them to sign a " joint and several contract " and provide parent guarantors as required by our mortgage lenders.
We do bills inclusive so no arguments about who takes responsibility for the gas, the electric, broadband, water, etc
However No insurance company will provide cover for criminal damage done by your tenants so having the whole group on a joint and several means everyone is responsible for looking after the property.
Taking one month's rent as deposit from each tenant means you have 6 months rent if One student tenant decides they can't or won't pay the rent.
However in the 10 years we have rented to students we have never had a problem with anyone paying. Some have paid late due to waiting for loans,
Parent guarantors for students is the industry standard.
They have No credit history, No landlord references, No employer references and No assets or saving to make taking them to court worthwhile.
So if you want your daughter to move into a student house share and learn to live with other young people and cook, clean !! share and get on with strangers then you need to sign the guarantor forms.
Please don't force her to live in a bedsit or flat on her own for her own Mental Health it's not good and very isolating

lookstraightahead

It is the industry standard. But it shouldn't be.

You have your hands tied op - in the same position here. Risk being a guarantor, or risk no 'usual' accommodation.

The risk landlords face is no more than the risk parents face being a guarantor to other students.

welnik

lookstraightahead wrote: »

It is the industry standard. But it shouldn't be.

You have your hands tied op - in the same position here. Risk being a guarantor, or risk no 'usual' accommodation.

The risk landlords face is no more than the risk parents face being a guarantor to other students.

Thanks for your reply. Only just had the "paperwork" through from this letting agent. Firstly they are saying that they charge fees for guarantors, references etc which as of 1st June is "prohibited" and then it states that the guarantor has to be able to cover the rent x36. It doesn't say, whether this is the annual rent (£15,000), the monthly rent (£1300) or the student's individual share £417 per month. It also states the guarantors have to be 1) In full time employment (that rules me out) and 2) have their income confirmed by an accountant is Self Employed (her dad does his own tax return). So, that rules us out for being guarantors.

I've asked them to send through the correct paperwork wording it "I think you may have sent your old pre 1st June 2019 tenancy/guarantor form". The file name has a date in it of 2017!

dimbo61

It's maybe a bit late now but does the university your daughter attends have a student accommodation office or staff who help students find university approved accommodation ?
In Manchester the 3 big universities have Manchester Student Homes which has university approved providers and accredited landlords

FBaby

Same happened here. DD is moving to with 5 friends in independent accommodation in September (year 2). She had to pay separate fees, give a separate deposit, will pay her part of the rent directly but the contract is joint and several. All student accommodations come that way. Understandable from the landlords perspective.

They all had to have their own guarantors. The problem is that as a guarantor to a tenant under a joint and several contract, it means that officially, the landlord can go after any guarantor for the sum of not just what the tenant guaranteed for but any of the others (if say their guarantor doesn't pay).

I was of course not happy about it but no choice. The way I got around it, I think, is that to be legal, a guarantor agreement had to be witnessed, and indeed, the form asked for a witness signsture. So I got my DS to sign who is not 18. I think that mean his signature isn't valid, and therefore nor is the guarantor deed. They didn't question it and I could be wrong, but worth try. Fortunately, the likelihood of being taken to court over non payment of another student is low, so hopefully I'll never find out!

jonnygee2

For goodness sake don't be penny wise and pound foolish, just rent a studio apartment for her, in reality will work out a lot less hassle and money

That's a bit OTT isn't it? Most students live in shared houses at uni and they have a great time. You wouldn't want your children being Billy no mates all through uni just because someone on MSE. Com told you not to be a guarantor.