Guarantor for a joint tenancy

horace972897

Hi

I'm being asked to be a guarantor for a student house shared by five people on a shared tenancy. I realise this means i'm potentially on the hook for all the rent but want to understand what the extent of the risk is around damage and " any reasonable losses due " its an assured shorthold tenancy.

This is the text of the guarantor form minus any identifying details.

Could any of you comment please?

Thanks in advance

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Guarantor Agreement

 

I agree to the following conditions:

 

That ……………………………….....(the tenant) will pay the rent and meet the conditions of the tenancy agreement.

If the tenant does not do everything that they should do under the tenancy agreement (including but not restricted to paying rent), I will pay any reasonable losses due to BLAH (the landlord) as soon as I receive a written request.

That I will pay the landlord any reasonable legal costs in taking the tenant to court to get a court order for repossessing the property, or compensation for losses that the landlord has suffered under this tenancy agreement.

This agreement will stay in force for as long as the tenant continues to live at the property and until the tenancy has ended. “Ended” here means either until all of the keys to the property have been returned to the landlord, or the property has been repossessed by the Bailiffs.

If the landlord gives the tenants any extra time to pay any money that is due or otherwise makes any arrangements with the tenant relating to any breaches of the tenancy agreement, it will not affect my liability to the Landlord under this agreement in any way and I am liable to the Landlord directly for the losses he suffers as a result of any breaches of the tenancy agreement.

 

 

That I must provide proof of my identity, such as a copy of a photographic driving licence or passport, along with the signature to avoid fraud.

 

 

Signed                                                 Print Name

 

 

Address

 

 

 

 

Relationship to tenant                                                             Dated

eddddy

horace972897 said:

I'm being asked to be a guarantor for a student house shared by five people on a shared tenancy. I realise this means i'm potentially on the hook for all the rent but want to understand what the extent of the risk is around damage and " any reasonable losses due " its an assured shorthold tenancy.

You need to read the AST. That will detail the tenant's liability - which, in turn, will be your liability.


If you haven't been given a copy of the AST, some people might argue that you shouldn't ask for it - because a court might (or might not) decide that the guarantor agreement isn't enforceable, if you weren't given a copy of the AST.

Similarly, some people would argue that since the guarantor agreement isn't set out as a deed, a court might (or might not) decide that it isn't enforceable.

But that's all a bit risky - you can't be sure what the court would decide.


And if the guarantor agreement isn't enforceable, that might mean the tenant gets taken to court instead of you and gets a CCJ - and maybe you'd rather pay up, than let that happen. 

AdrianC

It's very simple...
Five people have a joint tenancy.
If those five people do not pay what they owe, you're on the hook for it...

I presume one of the five is your offsprog, and the other four are friends? Students?
I also presume their parents are being asked to sign similar guarantees?
The landlord will just go after whichever of the guarantors is easiest. And, yes, that does mean you may end up paying far more than your sprog's "fair share". Tough. It's a joint-and-several liability. They are each liable for 100% of the rent and 100% of the damages, not just "their" 20%. And that means so are you.

The alternative to signing is the tenancy going to somebody else.

horace972897

The AST

Tenancy Agreement

 

 

This is an assured short hold tenancy agreement under the Housing Act 1988.  It gives you a right to live in the property until the contract is brought to an end in line with the conditions detailed within this contract.

 

 

This agreement is between:

 

 

 

BLAH

The rent is £ BLAH, payable every calendar month, subject (if applicable) to the retainer payment clauses below.

 Retainer Payments due on the BLAH followed by BLAH on the first day of each month thereafter.

 You must make the first payment on the BLAH, and further payments on the first day of every month.

 You have paid a deposit of BLAH

 Your deposit is held in a tenancy deposit scheme, the details of which are: BLAH

The start of this tenancy is the BLAH, and lasts for 12 months, and ends on BLAH

 

In line with Section 48 of the Landlord and Tenant Act 1987 you can contact us at the address below:

 BLAH

Telephone BLAH

 Rent and Other Charges

 1.      You must pay the rent in full and on the dates agreed. If you pay the rent late, we can charge you interest at 6% a year once the rent is 14 days late. We will charge you interest until the date we receive full payment. If we receive your rent from someone else we will consider them to be your agent. We will not create a tenancy with any person who pays rent on your behalf.

2.      We will work out the amount of rent which you do not have to pay for every day you cannot live at the property. This condition does not apply if you cannot live in the property because it has been damaged by a risk which it is insured against and is not habitable unless you or your guests or family did something (or failed to do something) which meant that the insurance policy for the property is no longer valid.

3.      You must pay the Council Tax –students currently have to register with the Council to enable the Council Tax charge to be waived.

4.      The rental charge payable includes the following bills, BT standard broadband internet, gas, electricity, water and sewage and TV License. BT fibre available at £10 per term per person.

5.      The inclusion of bills is subject to a fair use policy, should the total bills due exceed £ BLAH then the tenants will be asked to contribute to the excess.

6.      We or our agent may recover reasonable costs we have to pay for call outs because you have locked yourself out of the property.

7.      You agree to pay for damage caused to alarms or lights at the property due to lack of electricity supply if you caused the lack of electricity supply.

8.      You will be responsible for any reasonable call out charges if you wrongfully ask for a workman to come to the property, and this is due to incorrect information or against our advice.

9.      You will have to pay workmans call out charges if you fail to keep an appointment. You can avoid these charges if you cancel the appointment at least two hours before the appointment.

 Deposit

 We will not pay any interest on the deposit you have paid and we will keep the deposit to pay for any of the following which may happen:

 1.      If do not pay your rent ( you are not permitted to use the deposit instead of paying rent)

2.      If you or your visitors damage the property or the furniture we have provided.

3.      Any reasonable legal or other expense we have to pay as a result of you not meeting the conditions of this agreement.

4.      If you break any condition of this agreement.

5.      If we have to pay for removing or storing any belongings you leave behind at the end of the tenancy, or clearing any rubbish which you have left.

6.      If we have to have the property cleaned because you do not leave the property in the same clean condition that it was in when the tenancy started, depending on wear and tear.

 The deposit will be returned, within 14 days once we have checked the property. If there is a disagreement, we will deal with this in line with the conditions of the tenancy deposit scheme in which it is held.

 You should give us a forwarding address at the end of the tenancy so that we can return money to you. You agree that the deposit will be returned by cheque to a nominated individual tenant.

 Unacceptable Behaviour

 1.      You must not use or threaten to use violence against a person who is lawfully living in the property.

2.      You must not cause a nuisance to or annoy anyone living in, visiting or working in the area around the property. This includes loud music or other noise which can be heard outside the property between 11pm and 9 am.

3.      Do not put anything in the drains that may block them.

4.      Do not have any form of heating other than that we have provided. Paraffin, Portable Gas, LPG heaters and electric fires are not permitted.

5.      Do not block any flues or vents to the property.

6.      Do not put rubbish anywhere than in the areas and bins provided.

7.      Do not allow the gas, water or electricity to become disconnected. You must pay for these to be reconnected if it was your fault they were disconnected.

8.      You must not keep any pet without our permission.

 

horace972897

Part 2

Using the property

 1.      You must not run a business from the property.

2.      You must not allow the property to become overcrowded.

3.      You may transfer this contract if we agree, and to a person who is suitable both in terms of their financial situation and their character.

4.      You must use locks that are fitted to the property and set the burglar alarm when you go out.

5.      You must not give a key to anyone not named on this contract. If at the end of the tenancy we believe we have not received all the keys to the property, you will have to pay our reasonable costs for fitting replacement locks.

 Our right to enter the property

 1.      We may enter the property at any reasonable time to carry out gas safety inspections, carry out any other inspection needed by law, or deal with pests.

2.      We may enter the property at any reasonable time to inspect the condition or to carry out work or repairs needed to meet our responsibilities.

3.      We must give you at least 24 hours notice before doing this or asking someone to do this on our behalf.

4.      If there is an emergency and we need to enter the property immediately, we are entitled to enter, or if necessary force entry to, the property without giving you notice. You may have to pay for any damage done if  it was your fault that we needed to force entry.

5.      You must tell us about any fault or repair, in writing, which we are responsible for. If you do not, you may have to pay for any further damage caused as a result of any delay.

 Looking after the property

 You are not responsible for fair wear and tear to the property or to fixtures and fittings, but you must do the following:

 1.      Take care of the property and any furniture we provide.

2.      Take reasonable precautions to prevent freezing pipes.

3.      Keep surface drain covers free from leaves and other waste.

4.      Clean mould from walls and other surfaces regularly.

5.      Repair or replace any fixtures and fittings that have been damaged or destroyed as a result of a lack of care by you or anyone using or visiting the property.

6.      Not damage walls to hang pictures

7.      Do not remove any fixtures and fittings from the property without permission.

8.      Do not redecorate without our permission

9.      Do not spend money on repairs without our permission in writing. You do not have permission to employ workmen on our behalf. If you do, you will have to pay for them unless you were acting reasonably to deal with an emergency repair and we could not be contacted in advance.

10.  You must keep the garden tidy and well maintained.

11.  You agree to replace all fuses, light bulbs, flourescent tubes and smoke alarm batteries whenever necessary. You agree to test fire alarms and smoke alarms at appropriate intervals to ensure they are working correctly.

12.  You agree to pay for treatment needed to get rid of fleas, ants, mice, wasps nests and other pests unless you can prove these are as a result of us not meeting our repairing responsibilities or these existed at the start of the tenancy.

13.  You must disconnect the gas, water or electricity if these are not working correctly.

 

   Giving us relevant notice about the property

 You must give us any original notices, orders or similar documents about the property that are addressed to us.

 Leaving the property empty

 If the property is to be left vacant for more than 28 days you must tell us about this in writing as this may effect our insurance policy.

 

Joint tenants

 The legal effect of a joint contract is that tenants can be made to pay for any cost arising under this contract either as an individual or together.

 Survivorship

1.      If a joint tenant dies, or is no longer part of this contract for some other reason, the remaining joint tenants will be fully entitled to all rights and have to meet all responsibilities under this contract.

2.      The joint tenant is not entitled to any right and will not have any responsibility after they have ended their part of the contract.

 Ending the contract

 1.      We may end the contract by giving you at least two months notice in writing in line with section 21 of the Housing Act 1988, that you must give up the property on a date shown on the notice.

2.      If you give up possession of the property before the date shown in a notice under term1, the contract will end on the date given in the notice unless you are leaving earlier in line with the conditions of you termination notice.

3.      The notice will not apply if we withdraw it before this contract ends and you do not object.

4.      Neither notice will apply if before the end of the contract you withdraw the notice and we do not object.

5.      We may end the tenancy before the contract term ends if you break any condition of the tenancy.

6.      If you are the only tenant and you die this contract will end one month after your death.

 

 When this contract ends

 1.      You agree to allow us to show future tenants around the property. We must give you 24 hours notice if we want to do this.

2.      You must leave behind anything belonging to us.

3.      No one else must be living at the property when you leave. Your tenancy will continue ( and responsibilities for all bills) if you do not leave the property empty. You agree to pay our reasonable legal sots if we have to go to court to repossess the property from someone you have allowed to stay at the property after you have left.

4.      You agree to us getting rid of anything that you leave behind at the end of the tenancy and you agree to pay our reasonable costs for removing these items.

5.      You must return all keys (and any additional keys cut) to the property. You will liable for all reasonable costs involved in changing all the relevant locks and supplying new keys.

6.      You agree to leave the property in the same clean condition you found it. You must clean the inside of the windows and pay for any damage to carpets that have been damaged during the tenancy.

7.      You agree that we can send details about the way you managed this tenancy to any future landlord or agent.

  Forfeiture clause

 A court may order you to leave the property before the end of the contract if any of the following happens:

1.      You have not paid rent for more than 14 days after it is legally due.

2.      You or your representative have provided false or misleading references.

3.      You break any condition of this contract

4.      You leave the property empty for more than 28 days ot it seems you have abandoned the property.

5.      You become bankrupt, your belongings have been seized by bailiffs, or you enter a voluntary agreement to with the people you owe money to.

 If any of these things happen we have the right to enter the property after the bailiffs evict you following a court order for possession.

 

Other charges you have to pay

 We may have to pay costs if you do not keep to the conditions of this contract. The law allows us to recover our reasonable costs from you. The costs you will have to pay are as follows:

 1.      If we have to send you a letter because you have broken the agreement (including owing rent) you must pay our reasonable costs of not more than £15, excluding VAT.

2.      If you do not pay the rent on the date which it is due, you will be charged a fee of £15 excluding VAT.

3.      If your bank returns a cheque , standing order or direct debit unpaid you must pay a fee of £15 excluding VAT

4.      If you do not cancel your standing order for payment of rent at the end of your tenancy and as a result make an over payment of rent you must pay our reasonable costs of not more than £15 excluding VAT

5.      If we send you s Section 8 Housing Act 1988 Notice because you have broken this agreement you must pay our reasonable costs of not more than £30 excluding VAT. Failure to respond to this notice will result a visit to your property and costs due of not more than £55 excluding VAT.

 

Insurance

 We agree to insure the property with a reliable insurance company and keep it insured during the period of this contract and any time you continue to be a tenant.

 We will not insure your belongings. We will only accept responsibility for your belongings if the damage or loss is caused by something we have done.

  Other conditions

 1.      If any condition of this contract cannot be enforced or is found to be unfair, it does not effect the other conditions of the contract. Only the condition effected no longer applies.

2.      References to you also mean all joint tenants who have signed this agreement, and the guarantors if there are any. The responsibility is joint and several which means that one or all of the people named can be asked to repair any damage or cover any loss we have suffered.

 Other acts of parliament

 No one else will benefit from this contract as allowed by Contracts (Rights of 3rd Parties) Act 1999.

 The Consumer Protection (Distance Selling) Regulations 2000 do not apply to this agreement.

Signature of landlord

 

BLAH

 

 

Signature of tenant or tenants;

 

 

BLAH (you, the tenant)

tacpot12

Damage could easily run to £20,000+ in the event that one of the tenants starts a fire or floods the place; not least of which the landlord can claim for loss of rent according to the agreement above. If you own your own home, and don't have deep pockets for a solicitor, you should not sign this guarantor agreement as you could end up losing your home to pay the bill.

If you do go ahead and act as guarantor, get a key for each lock at property and insist that your child informs you if any lock  is ever changed. (Get a new key for the new lock if they are). When the tenancy ends, fit new locks to the front and back doors, get another couple of keys cut and hand five keys + a copy of the receipt for each lock back to the landlord/letting agent. This gets around the key clause. Don't forget to factor in the cost of travelling to the property to fit new locks or of paying a handyman to fit them. The locks needs to be British Standard (TS007 Three Stars for Euro cylinders) so expect to pay upto £40 per lock. See if you can get the other guarantors to send you £20 towards this when you have all signed. The above assumes that no one is still occupying the property - you need to be careful as you could be illegally evicting someone if you change the locks... 

531063

Doesn't look like it's served as a deed so I would question it's possible enforcement.

Ignore me just seen eddddy post

greatcrested

Courts have been unpredictable regarding the vlididy of guarantee agreements.

Strictly speaking they should be

* executed as a deed

* signitures witnessed

* tenancy agreement provided before execution

But courts have often overlooked these requirements "where the intention is clear". I guess if a lower court did take this view, an appeal might be possible but you're then into complex, expensive legal areas.

Some garantee agreements do specifically limit a guarantor's liability to, say the individual tenant's 'share' of the joint rent, ie in this case 1/5th of the total rent arrears - though it's hard to distinguish between which joint tenant has/has not paid.

silvercar

If this is in a popular location, where decent student properties get snapped up quickly, the result of you refusing to be a guarantor will be to limit your offspring’s choice of properties. He will be left to scramble over the ones where the landlord doesn’t insist on a guarantor, often the dregs. 

The other option is for your son to look at private halls, but these can be more expensive. Also students seem to have a desire to live in shared houses.
One thing I would try and do is ensure that all the other students are also providing guarantors, you don’t want to be the only one supporting the tenancy.

dimbo61

Every single year this comes up on this forum.
My 18/19/20 year old son/daughter is going off to University and some rich greedy HMO landlord is asking me to sign a Guarantor form to say we will pay the rent if my Son/Daughter decides they can't pay Rent and afford Drink/Drugs/Nice clothes ! 
Why should I take responsibility for my offspring ?
As a HMO landlord I am handing the keys to our £350,000 property to a group of young students I know absolutely nothing about except they got into the local University.
They get loans paid in September/January and April so can cover the rent if they want to pay.
In 30 years of renting to students we have Never had cause to try and claim against Parent guarantors.
This is another form of insurance which is required by many BTL lenders

dimbo61

PS I would not be happy if the student tenants changed the locks.
High security locks on doors and need to cut perhaps 9/10 keys due to students locking themselves out and keys for Landlord and maintenance staff.
Check that the Landlord has a HMO licence, EICR, GSC, Pat and legionnaires checks. Mains wired interlinked smoke alarms system, CO alarm, Security alarm and CCTV.
Deposit protected and correct checks done Right to rent ,  AST etc