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Original poster

Acting as a rent guarantor for DH's brother--very bad idea?

28 replies

YanknCock · 10/08/2009 13:26

DH got a call from his brother today, asking if we could be guarantor for their rent, since BIL and SIL are both not working. I can understand them coming to us because it has to be someone working (DH has a good job, I am on maternity leave from mine). DH's parents are retired, so cannot be guarantors. SIL's mum is on benefits, and her dad's company is going out of business, so soon he won't be working either. Basically there is no one else to ask.

However....DH and I are both more than a little nervous about this. If something did go wrong, we cannot financially afford to cover their rent, not even for a month. We have our own mortgage, overdrafts, and bills, and though we are slowly clawing our way out of debt, we are still living paycheque to paycheque.

BIL and SIL seem to think this isn't a big deal, that it's as simple as sticking DH's name on. I think it involves credit checks, which we'd rather not have as there were loads in the last 8 months when we bought our house. I'm not even sure DH could be accepted as a guarantor anyway--surely he'd have to prove he could cover their rent, and a credit check would reveal we simply can't!

Anyone been a guarantor and know how it works? Would like to have all the information before we most likely have to say 'No' and have them get all pissed off with us.

OP posts:

TheProfiteroleThief · 10/08/2009 13:28

This reply has been deleted

Message withdrawn at poster's request.

K999 · 10/08/2009 13:28

If you are a guarantor, you become liable. I am sure they would do credit checks so if it came back that you couldnt act as guarantor then at least you could say that you tried...

Doodle2u · 10/08/2009 13:29

I wouldn't do it. Rist too high.

SIL's dad's business is going down the tubes but it hasn't gone yet? Therefore, her Dad can still stand as guatantor.

Original poster

YanknCock · 10/08/2009 13:34

Yep, I'm pretty sure it's yet another case of BIL and SIL rushing into something without considering the consequences or getting the correct information. Poor DH feels very pressured....wants to help his little brother, but at the same time feels that they've not really tried to help themselves, and that they're not taking asking us to be guarantors seriously enough. Not to mention the fact that we probably wouldn't be accepted anyway!

OP posts:

littleducks · 10/08/2009 13:39

If you could afford it then it would be kind.

But you cant, and they do credit check you and obv want a guarantor who can afford to pay.

You could ask to see the paperwork/discuss with agent and then say to them you are sorry but you dont have a high enough income, which you prob dont if you couldnt afford to pay a few months rent if they defaulted

FiveGoMadInDorset · 10/08/2009 13:47

If you can't afford to pay it then no, I wouldn't do it.

notwavingjustironing · 10/08/2009 13:51

Without wishing to sound rude, if neither of them are working, how are they going to pay the rent in the first place?

JodieO · 10/08/2009 13:52

Don't do it, far more hassle that it's worth dealing with situations like that.

LeninGrad · 10/08/2009 13:53

This reply has been deleted

Message withdrawn at poster's request.

amidaiwish · 10/08/2009 13:56

can't you say that you have looked into it and that as you don't have the disposable money to cover their rent if they did default then you can't be guarantor.

i don't see why retired parents can't be guarantors if they have a good income. not saying it is a good idea, maybe they have used it as their excuse to say no?

FAQtothefuture · 10/08/2009 13:57

notwaving - I presume Housing Benefit (LHA).

They don't look at disposable income. - they look at your credit rating and your income and make a decision based on that.

Most want the guarantor to earn at least 3-4x the annual rent (so take the rent multiply by 12 and guarantor income usually needs to be that figure multiplied by 3 or 4).

It's a huge thing to ask someone to do - and tbh it sounds like your BIL is treating it very lightly. I was absolutely shitting myself about asking my vicar (only person I knew who may have been able to do it) if she would be my guarantor - thankfully she said yes and passed the pretty strict guarantor checks they did. However I had also "prepared" myself (As much as I could) by having 2 months worth of rent saved up incase the housing benefit took a while to come through.

If you don't want to do it just say no.

notwavingjustironing · 10/08/2009 13:58

ah right. Wasn't sure how it worked.

Original poster

YanknCock · 10/08/2009 14:03

'how are they going to pay the rent in the first place?'

Housing benefit. They have a baby girl and are living in a 2nd floor flat at the moment. They applied for a council house but the wait is years, so they got this list of private landlords who will rent to people on benefits. They are keen to leave their current flat as it's on the 2nd floor, and SIL has knee problems (I think she gets some kind of incapacity benefit for it). However, it isn't like they are homeless, so they need to realise that everything doesn't automatically go their way, and that sometimes there is no one to bail them out.

They will probably get pissy with us, but we live 3 hours away and are two weeks off having our 1st child, so really can't be bothered being embroiled in their issues.

OP posts:

Original poster

YanknCock · 10/08/2009 14:10

Cross-posted...

Cheers for the info, FAQ. I think the thing that bothers DH and I the most is that BIL and SIL are acting like it's no big deal, when it really is!

DH on his own earns about 3.5 times the annual rent on this place. If we were joint guarantors, we'd have about 5 times the annual rent---not that it means we have it to spare though.

OP posts:

amidaiwish · 10/08/2009 14:13

would you be happier doing it if they gave you 3 months rent up front? not saying they would/could but might be easier to give them some options than an outright no.

could be in a bank account that dh and BIL were joint signatories for. maybe parents/ILs could give it/

FAQtothefuture · 10/08/2009 14:16

you're right it's a huge deal, if HB screw up, or if they don't pay the rent after they've been given the HB it falls on your shoulders to sort it - regardless of whether you have the disposable income or not.

If I were you I would simply say that you can't do it. If I were ever in the position to (on paper) be able to afford to be someone's guarantor I'd be saying no unless they've shown that they realise just what a huge deal it is.

Their current place doesn't sound ideal for them with her knee problems - but like you said they do have a home - it's just not quite what they need (but how many other people get stuck in homes that aren't quite what they need??)

expatinscotland · 10/08/2009 14:18

If you cannot afford to cover hteir rent even for a month, it needs to be a NO. End of.

Because housing benefit is easily cocked up and can take a month to sort out easily.

Am I, like, the only person who lived in a 2nd floor flat with not one but two children (one knee full of pins, the other with next to no cartilage in the meniscus and a good chunk out of the tibial plateau, too)?

We're on the wait list and will accept a 2nd floor flat if offered.

This time with three children including a 9-month-old baby who weighs 30lbs.

expatinscotland · 10/08/2009 14:19

X-post with FAQ.

Housing benefit gets screwed up A LOT, particularly when moving from council to private.

Usually, you have to re-apply for it with such a transfer.

FAQtothefuture · 10/08/2009 14:24

I was very lucky my HB was sorted (with no screw ups - and first time claiming the HB part) within a few weeks. Meant I got ahead of myself with the rent - so the HB that came in was put towards the next months rent rather than being used to cover the expense of the previous months.......which was rather nice when I moved back in with DH as my last payment was in effect a "spare" one .

GypsyMoth · 10/08/2009 14:36

wonder what happens in these cases if (just supposing) they split up? if sil stayed there and your bil moved out....you'd still be responsible.

i would tell them whats required of a guarantor(maybe they don't know the ins and outs),like whats been mentioned here,see if they think its such a small thing then when they know whats at stake.

Original poster

YanknCock · 10/08/2009 14:46

Thanks everyone. I called the estate agent just to check on the situation, and from what she told me, I am fairly certain if we applied to be guarantors we'd be turned down. The income requirement we can meet, but a credit check would certainly show we are in too much debt to cover their rent.

DH is going to call his brother now and say no. We are both annoyed that they didn't even bother to find out what was involved in being a guarantor before asking us (why are we doing the legwork here?). The estate agent said BIL/SIL have already told them they want the place!

DH will be suggesting to them that they either negotiate with this landlord to drop the requirement for a guarantor, or they find another place without that requirement.

OP posts:

crokky · 10/08/2009 15:05

Do DH's parents have some money so they could pay a few months rent upfront to the landlord so that there wouldn't need to be a guarantor?

stuffitlllama · 10/08/2009 15:13

Think you've done the right thing.. you usually guarantee for however long the lease is. So you could still have it hanging round your neck months after they moved on.

AxisofEvil · 10/08/2009 17:15

I agree you're doing the right thing here.

Original poster

YanknCock · 10/08/2009 20:55

DH's dad could probably cover a few months, but I doubt he will offer to, seeing as he's given BIL and SIL a lot of money over the last year or so that he will never see again. If it were a matter of them being homeless, I'm sure he'd help them (as would we, we could at least offer them a roof over their head)--but there is no particularly urgent reason they need to move right this minute.

Just spoke to DH's mum, apparently BIL and SIL's latest plot is to ask a friend of theirs to be the guarantor. He is working, but there is no way in hell he makes £35k p.a. He's a young guy who lives with his mum! Think they are being quite selfish in asking this of him, and I sincerely doubt he'd be accepted as guarantor anyway.

Anyway, BIL didn't get pissy with DH when he explained why we couldn't do it, so that's something at least. Was hoping they'd grasped the seriousness of it, but the fact that they're just trying to stick their friend in it shows they really aren't taking it seriously!

OP posts:

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