Tenancy guarantor - insurance

mta999

You won't get insurance and your exposing yourself to potentially very large losses - not only if someone doesn't pay rent but any damage to the property or whatever

GrumpyDil

@Catonthemoon OP hasn't said that this is an HMO which would be better as each occupant would have a separate tenancy agreement.

@CAG8 I assume that the tenants are jointly renting the house so know each other, although I have to be honest I wouldn't be comfortable acting as a guarantor in this situation. Has your daughter looked for a room in an HMO as that would probably work better?

CAG8

This is the 2nd year she has been in this house. It is in London, so no - she can't afford to rent a whole property on her own, and doesn't have a partner to do this with. Even 1 room of this house is about the same as a whole property in the area we live.

Last year she moved in to the house with 3 girls who all knew each other well from university. She is firm friends with them now yes. So it is not an HMO no. The house is a few minutes walk from where she works - so saves a lot of money on tubes etc.

I am not comfortable with it. 3 of the girls have guarantors (inc us), 1 earns enough not to need one. I am hoping our daughter won't need us in a few months.

theartfullodger

(btw I've been a landlord since 2000). Many (MANY!) guarantee agreements are invalidly or questionably worded, such that with the right defence a court would throw out the landlord's case if they went after you - see..

https://england.shelter.org.uk/housing_advice/private_renting/guarantors_for_private_renters

&

https://www.citizensadvice.org.uk/housing/starting-to-rent-from-a-private-landlord/using-a-guarantor/

However - which country (eg NI, Scotland??)?? The law varied, (my links above is from the experts but applies to England).

However, if valid, then these agreements are pretty much a blank check you might be signing.

I have 3 sons (now post renting) but was never willing to act as guarantor myself., being risk-averse.

So, read the links carefully, and the draft agreement, and then work out if you are at risk or not…

Good luck, best wishes

Grumpy_chap

https://forums.moneysavingexpert.com/discussion/comment/81986641#Comment_81986641

The guarantor-ship does not work like that "1 earns enough not to need one. I am hoping our daughter won't need us in a few months".

Once you sign the guarantor-ship, you are bound into that for as long as any of the current tenants remain in the property. In fact, check how the tenancy is set up as it might even make the 1 that earns enough not to need a guarantor liable for the rent of the other T's.

Do not do this as a guarantor.

Rather than this house-share, can your daughter find a genuine HMO where each of the Ts have no connection or liability for the other Ts?

otb666

I have never used them but google search came up with this https://www.rentguarantor.com/

btw we once had to be a gurantor for our son and there was 8 people there and it turned out alright I think as most parents are in same position so not going to let you down hopefully. But was relieved when tenancy ended for sure

gm0

When we were offered this outrage "guarantor for 4-5 random other familes" by a managing agent. We marked up the agreement to adjust our liability to cover only our student child's share of rent.

So we would not become a patsy for other parents or their delinquent offspring.

And signed the modified one and returned it. The agent clearly got enough back from various parents to feel confident they had cover for the landlord across the whole amount.

This was student letting in a normal house rental (not halls) where multiple occupancy was normal and the place was let to students on that cycle. Every year.

Bear in mind an improperly executed guarantor agreement - isn't enforceable anyway.

Agents push for all the families to guarantee all the rent. Easy street. Now we can chase the normal people to get the losses as the rogues are harder to chase. And there is no obligation to chase the delinquent family - if you all signed up for all of it.

If at all possible. No

I am a bit out of date on how this is affected by current rules changes. From memory…..as a practical matter

2nd best is probably being a lodged with another person as the proper tenant for the whole. Insecure. But low risk. No guarantor.

And 3rd is being the sole prime rental tenant. And only taking lodgers with well drafted agreements for lodging with a resident landlord (you) - not tenancies. For the others so they are insecure. Don't pay - you are out. Don't behave - you are out. But the control of the tenancy rests with you. This of course requires affordability to work. And you own any "voids" for empty rooms you assumed were let at local market rate to cover rental. But you have control. And the guarantor element is limited to family of sole tenant.

user1977

This sort of discussion sometimes overlooks that even without the guarantees, the tenants are likely to be signing up for joint and several liability amongst themselves - so the issue of "why am I guaranteeing a relative stranger's potential debt to the landlord" is still something for daughter to consider.

ExEstateAgent

https://forums.moneysavingexpert.com/discussion/comment/81986641#Comment_81986641

3 tenants is indeed a HMO and it sounds like you are already involve as g'tor.

Unfortunately it's not something you can decide to end, it's up to the Landlord. You need to read the terms of the agreement and understand fully what your obligations are and how long they may last for.

Myci85

If this is the second year she's been in the house, why is the issue arising now? Did she not need a guarantor last year? Or are you already signed up to it?