Can't believe no friends will act as guarantors - why do they think they have to pay?

[IWillAlwaysBeinaClubWithYouin1973]

I mean do they literally think I am going to refuse to pay my rent?

Split from H last year, my home of over 30 was sold I have the equity in the bank still because I've just pulled out of a house purchase and decided to continue renting. Found a new flat within days now I am actually scared I'm not going to get it, nor anything else to rent, unless I have a guarantor. New letting agents/landlord not accepting equity, they want a guarantor as well as 6 months in advance.

I've just stood guarantor for my youngest DD and her uni flatmate, didn't think twice. I know what's involved, I would have thought it's obvious you assume the person will pay their rent - surely you just use your judgement? But had some awkward conversations with friends - we're all professional people, but they actually they think its going to affect their credit rating, ability to get a mortgage and that it will "stretch them financially"? I work, have the equity from the house in the bank, I'm 60 bloody 2! How much of a flight risk do I appear to these friends?! So far 2 said no, 2 ghosting me, I need to provide info to the agent first thing in the morning. Going to move on further down my list but it's getting more and more tenuous. I feel a bit sick to be honest.

Do you know what a guarantor is/does or would you too think you stood a reasonable chance of losing £000s, or even that I was actually asking for money in some way? Is it something that people just don't feel comfortable to do?

OP I forgot to mention in my post that you can actually get rent payment protection insurance that guarantees your rent payments in the event of illness/injury or other potential financial situations affecting your ability to pay. That may at least reassure the landlord or any potential guarantor that you’re responsible enough to cover some of the responsibility yourself. I believe Aviva, Legal & General, and Howden offer these types of policies so might be worth looking into.

Think of it this way: would you put a year's worth of rent into your friends account to cover an eventuality when they do have to pay? With the understanding that they'd transfer it back afterwards if not required? If not, then you don't trust them with your money, so why should they trust you with theirs?

It’s not about someone ‘ refusing’ to pay their rent and therefore whether or not to consider them as an honest person who pays rent!The more likely scenario is that someone becomes unexpectedly unable to pay it, due to losing a job, having an accident/ illness, etc, and the guarantor is then liable for potentially huge amounts of money.

PS OP I hope it does work out for you - I can understand it is scary.

I wouldn't be offended or worried if I was asked so try not to worry about that part. I wouldn't do it either but it wouldn't bother me to be asked.

Normally when the initial fixed term tenancy agreement ends, the guarantor can end the agreement at that point. They can also end it if there is a change of circumstance during the course of the tenancy agreement, such as an increase in the rent. Any guarantor should make sure of the specifics of the tenancy period before they sign.

@IWillAlwaysBeinaClubWithYouin1973 I'm late to this thread so sorry OP if what I post has been written many times before (I've only read your posts). I'm a former adviser with Citizens Advice and I would always advise clients to never become a guarantor for someone unless they have the money to lose. I've seen far too many clients' relationships with family and friends destroyed by such arrangements (including one grand-mother's own financial and housing security put at real risk in her advanced years). Whenever I hear/read someone thinking of becoming a guarantor my one-word response is "Don't!" No-one plans to leave their guarantor on the hook for paying their rent, but sadly, sometimes shit happens. I realise this is extremely unlikely in your case given the large financial buffer you have, but generally I would always advise against becoming a guarantor for anyone and I'm glad to see that this is a message more people are taking on board.
That said, I'm surprised the agent is insisting on a guarantor when you can pay the 6-months rent for the entirety of the AST upfront - why then is a guarantor needed? What would they be guaranteeing when you've already paid the rent? This doesn't make sense and I think it would be worth you challenging the agent on this point because they don't seem to have thought it through.
Alternatively, if the requirement for a guarantor is non-negotiable, there are guarantor companies who will provide this service - for a fee of course - but this may be your last resort. Good luck OP.

Are you insane! What if you had a stroke or cancer and lost your job. That person would have to pay all your rent until the end of your contract. Not one single person I know would do that.
I certainly wouldn't. It would be financial suicide.

I now have an Iva because I was a guarantor for a friend

I think it's really bad that the landlord's actually asking for a guarantor if you're willing to pay six months in advance. Do you have a job with proof of wage slips/contract?

@Clafoutie of course I see your point and thanks for understanding.

Just popped on again as someone reminded me - if you want to use your equity it has to have been in an instant access bank account for 6 months, dependent on the referencing company the lettings agents uses. They are all different, there's no blanket rules. There's a lovely agent near here that uses Goodlord, they accept equity in your bank account for only 30 days - if only they had a property to rent to me.

Also I've had 2 quotes for the guarantee companies. One was £177 a month on top of your rent, and the other was £1,500 for 6 months.

I've also checked with my mortgage broker and he said its not possible for your simply "being" a guarantor to affect your credit rating or the amount you can borrow (although Google says differently so not sure if the jury is still out on that one).

Arent there companies that provide guaranteeships? I know a lot of overseas students have to use them so assume they’re also available to professionals.

Yes, you’re right, I would do it for exH too as he was never ungenerous.

There is no way I would risk my finances.

Nor would I ever importune anyone else to take a big risk on my behalf.

Why don’t you offer to pay a full year in advance.

Quite right. I have two friends who were best firends but now do not talk after one was the guarantor for the other... who then lost her job. Caused a lot of bitterness.

Absolutely this.

I wouldn't do it. Divorce is costly at all levels.

Yes, and I am already drawing a private pension, so two sources of income. I think some people have been really keen to insist I must have a bad credit record, I've never had any issues at all. I think the issue is, I have been offered a flat that I like and need, everything is great about it, but the landlord wants an additional layer of safeguarding and if I am not prepared to offer it, he has no obligation to agree to rent to me.

So there are two strands here aren't there, the issue of my being stupid in the first place which is clear, and all I can do is my best to put that right. I'm lucky no one was upset or put out. Now we are moving into the land of rental problems in general, and I think I said upthread I'd already asked MNHQ to consider a renters' topic so I will be following up on that with them.

I sympathise with you OP if this is the norm in the rental market now. If you are paying 6 months up front for a 6 month rental then it seems ridiculously unreasonable. I know parents are often having to act as guarantors for student accommodation which I don't recall ever being the case when I was a student so there seems to be a growing trend for this. I also would only act as a guarantor for my child and unlikely not for anyone else. Not even for another relative as there are many stories of relatives not repaying money they borrowed for example so it is risky even with a relative. Friends may also worry that you will abuse the friendship and leave them saddled with your rental bill or may just hit hard times unexpectedly. I hope there is a way you can meet the latest demands of landlords without having to put your friends or relatives in an awkward position. It seems ridiculous! Someone mentioned a guarantor company so perhaps you can pay funds to a company that holds the money in reserve (but it needs to be secure, trustworthy company so you can get the money back if you don't default!).

@IWillAlwaysBeinaClubWithYouin1973 "but the landlord wants an additional layer of safeguarding and if I am not prepared to offer it, he has no obligation to agree to rent to me." This is the crux of your problem OP. The landlord's an idiot because he's asking for a layer of protection that he simply doesn't need in your case, but he likely has 30-odd prospective tenants to choose from so he can be as idiotic as he likes. It probably hasn't dawned on him that you're the better bet as a tenant than any other options he has. Sorry OP.

Could you say to a friend, if you have money from your house sale, that you'd transfer the money to them to cover the full contract (with a written guarantee they won't spend it and you get it back at the end), so that they know you're able to pay, even if you can't pay, if that makes sense?

Curious to know why the funds you have in the bank aren't enough to support your application, though? Do you have a bad credit history?

Actually, you shouldn't even be a guarantor if someone does do that. You're also making yourself liable for any damages to property or legal costs that the landlord might seek to recover from the tenant - it's usually very open ended, not just about the rent.

OP I think there’s always a tendency for pile ons to happen on topics like these - especially in AIBU. I’ve been heavily involved with helping a friend find a flat recently and the thing that really surprised me was how many landlords required a guarantor even for a short term let or room rental, and some want a guarantor in addition to rent up front. Many posters here are assuming you only need a guarantor if you have bad credit and that’s just not the case.

I’ve seen many advertisements on sites like Zoopla and Rightmove, and even room rental sites who ask for the most ridiculous evidence before they’ll even show you the property - they want payslips, bank statements, landlord and personal references, and in my friends’ case, because she is self employed, tax records to prove the last two years earnings. And inevitably a guarantor as well, even when rent is paid upfront for the period. I think the problem is that demand is outstripping supply and landlords feel entitled to ask for these things just because they can. I understand it can be difficult to evict a tenant but much of the information they ask for won’t guarantee that the tenant will actually pay the rent anyway !!

You sound like a good egg OP. You've handled the nasty wee shites very graciously. I wish you well in your new home with your ddog. 💐

PLEASE just buy a property. PLEASE. PLEASE. PLEASE. PLEASE. I've seen this situation happen to many people and they end up renting because it's easier. Easier in the short term, yes. In the long term?! Absolutely not. BUY. Chose your hard.

Hard now = slogging it out, waiting for the right property and the lengthy drawn out process that goes with it.

Hard later = landlord boots you out, you go through this process again. Limited security, it's unlikely property value is going to go down any time soon. You would be very vulnerable and could easily be left short changed if and when rents go up and as you get older, money will become harder to earn.

As for the guarantor situation - yes I'm not surprised at all. I'm dreading my children going to university and doing it for them. There's no way I would do it for a friend. It's not so much you but the unpredictable circumstances in life (especially these days!).