What is a guarantor?
By Allstate
Last updated: January 0001
A guarantor is a person who agrees to take financial responsibility for another person’s lease if they cannot meet their financial obligation under a lease, explains Equifax.
Guarantors are typically used when a tenant does not meet the landlord’s requirements for a lease, such as minimum income or credit score. In signing the lease, the guarantor agrees to cover missed payments and, in certain circumstances, damages.
Is a guarantor the same thing as a co-signer?
The terms guarantor and co-signer are sometimes used interchangeably, but they can function differently depending on the lease agreement. A guarantor’s role is to guarantee the tenant’s ability to pay rent, while a co-signer shares the responsibility of paying the rent, according to Equifax.
A guarantor’s responsibility only kicks in when the primary individual on the lease defaults, while a co-signer shares the responsibility for paying from when the agreement is made.
When does someone need a guarantor for an apartment?
A guarantor typically comes into play when a tenant does not meet the requirements to be a renter independently. These criteria can vary by landlord, but there are some similarities. Here are a few examples of times when someone may need a guarantor.
Poor or limited credit history
Credit scores can help landlords determine how reliable a tenant is when it comes to paying rent. If you have a poor credit score due to missed payments, high debt-to-income ratios, or limited credit history, landlords may view you as a risky person to rent to, according to Equifax. If you’re young, you may also just have a low credit score due to a short credit history.
In these cases, a guarantor with a stronger credit score can help reassure the landlord that someone with a reliable fiscal track record is backing the lease.
Low income
Landlords will sometimes require a guarantor if a lease applicant’s income is below a threshold where the landlord believes they will be able to cover the rent reliably, according to Stutts Properties
No Rental History
If you have not rented before, a guarantor may be required by a landlord because they do not have the assurance of a demonstrated history of repayment.
Who can be a guarantor on a lease?
A guarantor can be any individual who is able and willing to guarantee payment if the lessee defaults. This person should have a strong income and credit score, as they are assuming the responsibility for the tenant's financial obligations if they cannot meet it. Often, this guarantor is someone close to the tenant, such as a parent, spouse, or close friend, explains Stutts Properties.
What is a guarantor responsible for?
A guarantor is responsible for covering the tenant’s obligations should they fail to meet them. Stutts Properties explains says these responsibilities can include:
- Unpaid rent
- Cover property damage
- Handle legal fees
- Maintenance of the terms of the lease
How long is the guarantor held responsible on a lease?
A guarantor’s responsibility on the lease lasts as long as the agreement is in place unless otherwise specified in the agreement. This means that if the tenant defaults at any point in the lease, the guarantor can be held liable.
Risks of being a guarantor
Being a guarantor means putting yourself at financial risk. When the borrower does not meet the financial requirements set out by the lender or landlord, the guarantor will have to shoulder the responsibility for them. This means assuming responsibility for someone else’s actions.
How to find an apartment guarantor
As previously mentioned, many people ask a parent, close friend, or relative to act as their guarantor should the need arise. But if you don’t have someone willing or able to serve, you can consider a third-party service.
Third-party guarantor services can help bridge gaps for tenants who don’t qualify on their own. These services will guarantee rent payment in the event of a default according to TheGuarantors.
What if you can’t find a guarantor?
- Strengthen your application: If you don’t qualify in one way for a lease, you may be able to negotiate with the landlord by showing proof that you’re financially healthy in other ways, such as with proof of considerable savings, strong income, or paying more up front, explains Investopedia.
- Find a roommate: Sharing the rent with someone who meets the income or credit requirements individually or when combined with you can eliminate the need for a guarantor, says apartmentalist.com.
- Research rental assistance: Depending on where you live, you may qualify for rental assistance programs, according to USA.gov. These can be federal or local and programs can vary based on numerous factors but they can reduce the amount of rent you pay by subsidizing a portion for you.
Guarantor FAQs
No. A guarantor is typically only required when the tenant does not meet key criteria such as credit score, income, or rental history, and landlords need extra assurance.
Generally, once a guarantor signs the lease, they remain responsible for its full term, including any renewals, unless the landlord agrees to release them through a new lease amendment.
Expect to supply proof of income (such as pay stubs or tax returns), current bank statements, government-issued ID, and consent for a credit check. Landlords use this documentation to confirm the guarantor's ability to cover rent if necessary.
The landlord can pursue the guarantor directly for unpaid rent, fees, damages, and legal costs, and the guarantor’s credit may suffer as a result. In worst cases, the landlord can take legal action or enlist debt collectors.