Guarantor and Universal Credit

Grecian123

Hi all. I’m in a bit of a quandary. The mother of my child is about to move rental house and requires a guarantor.

I want the best for my daughter to make sure she also has a home with her mother too. Her mother also has another daughter who is very highly autistic requiring care. I have just been asked if I could be the guarantor. I earn a good wage. She has told me I would never be called on because she is getting £3,500 per month. She doesn’t work, but gets UC, housing allowance, disability allowance etc.

This shocked me as being a big amount. I thought UC was called at £1,800. Can anyone advise? I am having a big think about being guarantor

elsien

If the landlord won’t accept her without the guarantor, then how much she is receiving in benefits is irrelevant.

As guarantor, you would be responsible for her paying her rent if she was unable to do so. Is that affordable for you and is that something that you want to do on a long-term basis?

Because unless the guarantee form has some sort of get out clause, you’re in it for the long haul. 

I am unsure why knowing how much money she’s getting each month is making you change your mind about being the guarantor?  You are not guaranteeing all her benefits.
you are guaranteeing to pay her rent if needed. Do you know how much her rent is and can you afford it, If the worse comes to the worst. 

That’s the question you need to be asking yourself.

Grecian123

elsien said:

If the landlord won’t accept her without the guarantor, then how much she is receiving in benefits is irrelevant.

As guarantor, you would be responsible for her paying her rent if she was unable to do so. Is that affordable for you and is that something that you want to do on a long-term basis?

Because unless the guarantee form has some sort of get out clause, you’re in it for the long haul. 

I am unsure why knowing how much money she’s getting each month is making you change your mind about being the guarantor? 

It’s not make me consider changing my mind, I just wanted to ensure she could afford the rent so I could be confident. However, the income is higher than I thought it would be, so was just questioning if benefits etc can be that high as thought there was a cap

elsien

The benefits cap won’t apply because she is caring for someone with a disability. 

General_Grant

Are you able to sit down with her and say, for your daughter's sake, you want to see that her budgeted income will be sufficiently high to meet the rental payments and other vital items and also see written evidence for her claim that she would be in receipt of £42,000/year in benefits?

Grecian123

Following on from above, I have read that when rent becomes periodic after the fixed term, the guarantor is still liable and can only get out of it if the tenants take out a new contract (and not an extension).

The private landlord hasn’t contacted me yet, but wondering if I can have them add to the contract that the guarantor agreement will come to an end at the end of the fixed term and not rolled over (unless I sign another guarantor agreement for another fixed term). Anyone had joy with this before?

elsien

It  needs to be written in the contract if that is what you are agreeing to. No idea how often landlords go for that, but I suspect most want to cover all the bases and have a continual guarantor. You can but ask. 

What to look out for, from both sides of the contract.
GUIDE: Guarantors in rental agreements - what are they and what to look out for? (landlordzone.co.uk)

Grumpy_chap

Grecian123 said:

Following on from above, I have read that when rent becomes periodic after the fixed term, the guarantor is still liable and can only get out of it if the tenants take out a new contract (and not an extension).

The private landlord hasn’t contacted me yet, but wondering if I can have them add to the contract that the guarantor agreement will come to an end at the end of the fixed term and not rolled over (unless I sign another guarantor agreement for another fixed term). Anyone had joy with this before?

I suspect the LL would be unhappy with that.
Assuming this is a standard AST, then the contract automatically becomes periodic at the end of the fixed term and I do not believe that the contract can be amened to exclude this statutory right.
Even if the contract could be so amended, it is a poor solution for the LL as the tenant could stay and pay for the fixed term, then simply not move out but not pay rent either and the LL would have no guarantor to call upon at that point.

ian1246

There is absolutely no chance I would be the guarantor in this situation.

You will have split up for a reason - yet you'll now be guaranteeing to pay her rent or any damages, potentially for a very long time due to how long the eviction process takes. She might have a good income from benefits - doesn't mean she'll spend it on rent - and there would be no obligation to do so, since you'll be the one footing the bill if she decides not to.

Do you have a house or assets? How will you feel if she does your legs, doesn't pay rent & your assets are then put at risk for her debt?

The obligation is on her to sort her life out - not you. If she can't provide adequate housing for your child when with her, the solution is child comes & lives with you and instead mum does lots of day-time activities instead, until she sorts her housing situation out.

Really wouldn't do this if I were you...

elsien

Yes, they split up for a reason but that does not mean she’s a feckless wastrel who is going to spend all her benefits on lord knows what instead of the rent.
The OP is aware that there is a risk but let’s not go down the whole benefits stigmatisation route.  

Grecian123

elsien said:

Yes, they split up for a reason but that does not mean she’s a feckless wastrel who is going to spend all her benefits on lord knows what instead of the rent.
The OP is aware that there is a risk but let’s not go down the whole benefits stigmatisation route.  

Exactly this. She is a brilliant mum and unfortunately also has a child that has a disability that requires care.

We split 16 years ago, but have remained friends throughout. My fiancée is also friends with her. She got married (I went to the wedding) and started a new family. Then the child with the disability was born and meant she was unable to work. Sadly their marriage broke down, but her soon to be ex husband doesn’t earn enough to be guarantor.

She has rented for the past 16 years and never missed a payment. Just because she gets benefits it doesn’t mean she is terrible with money, it is just what life with a disabled child comes too.

Yes, I could say my daughter should come and live with me (only round the corner), but would hate to see her mum not be able to have a roof over her head, especially with the care required. My daughter is also a big influence to her sisters care too. I don’t want to split that all up.

My mini rant over