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?

Yeah this. ^ No way would I ever be a guarantor for anyone. (Other than my DC.) As for the 'what are people supposed to do if they can't get a guarantor' comment, there are property agencies who will find you a place with no guarantor. As you say @CandidHedgehog why should I put myself in the position of possibly having to fork out multiple 1000s (possibly even a 5 figure sum) in unpaid rent and repairs for damages caused. It's literally an open ended agreement, and I have seen people finanically screwed/wrecked by agreeing to be a guarantor.

There are other ways to get a private let property without a guarantor - which is just as well because many people are seeing the light now and refusing to do it. A quick google search brought up these.

Larger Deposit:
Landlords may be more willing to waive a guarantor if you offer a higher deposit, as this provides them with greater financial security.

Prepay Rent in Advance:
Offering to pay several months' rent upfront (e.g., six months) can be a strong alternative to a guarantor, especially if you have the funds.

Rent Guarantor Services:
Several companies act as guarantors for tenants, providing an alternative to a personal guarantor. These services typically charge a fee.

Periodic Tenancy:
If you can't find a guarantor, consider a periodic tenancy (monthly rolling agreement) which may require a slightly higher rent but offers more flexibility to the landlord.

Local Council/Charity Schemes:
Some councils and charities offer rent guarantee schemes that can help with deposits or provide a guarantor service.

And as I said, there are property agencies that will find a property for people who can't get a guarantor. They are sometimes in undesirable/hard to let places, but you can get your foot on the renting ladder, then build up your credit score, and move on later.

Frankly I would rather lend/give someone the first 2-3 months rent to negotiate with a landlord to pay the first few months in advance than be a guarantor and not know how many multiple 1000s I could be shelling out. (If they have a couple of months rent themselves they could pay 5-6 months upfront.)

I'd prefer to lose 2-3 grand (and know that this is the amount that I was going to lose,) than sign an open ended agreement to say I will pay potentially a 5-figure sum or more. (And the amount will keep increasing week by week by week....) Another thing is that many landlords won't bother rushing to fill the property (if the tenant stops paying,) because the rent will come rolling in from the guarantor.

When you sign up to be a guarantor, you are signing the lease/tenancy, for any money being borrowed, and you are agreeing to pay for any damages or disrepair to the property. YOU will be the one the courts and bailiffs will come after if you don't cough up. YOU.

Don't think 'oh well I have got nothing anyway haha.' They will take ANYthing they deem as a luxury/unecessary item... Your laptop, stereo, games consoles, DVD players, blu-ray players, ipads, ipod, Apple watches etc etc, and they have even been known to take your car. They don't usually take the TV, (but they can do,) and they will take additional TVs if you have more than one. Anything to attempt to get the money back.

.

Larger deposits are already illegal. Maximum allowed is equivalent of five weeks rent.

Rent in advance is about to be made illegal.

It's impossible to start on a periodic tenancy. Minimum initial term is currently six months. And it's just as difficult to evict non payers whether they are still within the initial term or on a periodic tenancy. Although currently Section 21 can speed things up - but I just used a Section 21 - issuing notice to bailiffs is about a year. And Section 21 is soon to be abolished anyway.

That information (in my long post that you quoted directly after I posted it!) was from GOV.UK. Maybe you should contact them and tell them they're 'wrong.'

.

Look up the law on deposits. Maximum allowed is five weeks.

Rent in advance is not currently banned but it's about to be

Actually yes, you can start on a rolling contract, but the courts consider all assured shorthold tenancies to.have a de factor initial term of six months, regardless of what the contract says. At least that is what I was taught in my course for accredited landlords.

Please post any links to anything that says any different.

Can you link it because it has been a while since the deposits changed

The point is that the potential tenant can OFFER a bigger deposit. Or OFFER 5-6 months rent in advance. To try and secure a property ... THAT is what I said. I said nothing about landlords demanding it. 🙄 Maybe YOU should read peoples posts properly before responding. Just a suggestion!

.

What's the point of offering bigger deposit when landlords can't take it?

They can. But if the landlord accepts they will be breaking the law. There have been recent cases where landlords have been unable to evict because their deposit was ruled unlawful - it was over the five weeks allowed by a fraction of a penny as they rounded up rather than down.

Rent in advance will be banned in the new renters rights bill. By banned I mean landlords will be banned from accepting it.

Have you investigated “guarantor-insurance’ it may be an option to put minds at rest
we are moving to privately owned sheltered accommodation next month and my sister has offered to go guarantor
i will be giving her a couple of months rent as surety so that there is a cushion if the tenancy ends suddenly I would hate her to be out of pocket after enabling the tenancy
i realise that not everyone can pay deposits and use guarantors due to financial constraints in addition to removal costs etc I can see why landlords prefer a deposit
maybe it motivates tenants to take care of their property and make sure they leave it in pristine condition I have read that some places offer a zero deposit option maybe this is dependent upon having collateral so not suitable for everyone

OP, I don’t think you’ve taken the piss asking friends. I think a lot of people are just very up against it with the COL at the moment which makes them risk-averse, and probably a bit depressed.

I would never risk my home by being a guarantor for someone else's.

Guys I've had to stop reading its all too much - I've "cancelled the cheque" to coin that old MN phrase, and also messaged MNHQ to suggest a rental topic instead of it all being piled into Property/DIY, in future. We will see.

The Renters' Bill has gone through the HoL and is now at Report stage, apparently progressing with very few amendments:

"Baroness Lister proposed limiting the circumstances in which landlords can ask for guarantors, providing data on how their use disproportionately disadvantages low-income renters. She said:
“Over the last five years, 550,000 private renters were unable to rent a home that they wanted because they did not have a guarantor that met the landlord’s requirements.”
She continued:
“Some 45% of benefit recipients and 43% of families struggle to provide a guarantor, compared with just 24% of those not receiving benefits or without children.”
GOVERNMENT RESPONSE
The Government rejected the amendment. Many still believe that requesting a guarantor remains vital for managing landlord risk."

If I started this thread not being clear about guarantors, it seems that many of those who castigated me had even less of a clue (the difference being that I immediately took full blame for my big mistake and didn't seek any moral high ground).

Did you get it sorted? I do hope so.

A separate topic would be a good idea. They need to keep the option to ask for guarantors. As the option for a large deposit and rent in advance is being removed, and as the time and cost involved in evicting non payers is likely to double (and it already takes a year) the risk to landlords of tenants without good stable incomes or credit histories just won't be worthwhile. The new bill is already going to make it much harder for those sort of tenants to be accepted. If guarantors are removed from the equation their chances of finding a property will be diminished still further.

It sounds hard for you, I hope you get something sorted out. All this sort of mularky is super-stressful at the best of times x

I've just done it for my student daughter, and for a fixed term of a year and even that's made me twitchy and anxious!

I agree on this. If you're only signing up for a six month contract and are offering to pay all that six months up front, in addition to a deposit, what is their main concern?

If it's the ability to pay if it moves to a rolling contract, can you suggest a fixed term contract where there is no ability to roll over? At least that way you can negotiate a new contract at the end, but hopefully will have found something to buy by then?

If it's the ability to pay if it moves to a rolling contract, can you suggest a fixed term contract where there is no ability to roll over?

As I understand it, it's not possible to do this under the law.

This. It has to roll over and the new law means it will be close to impossible to get the OP out.

Even if she never pays another penny after the first 6 month lump sum, it will take the landlord 12 to 18 months to get her out.

There is no such thing as a fixed contract with no ability to roll over. At the end of the six months they could stay, not pay rent, and it could take a year to evict. Longer when the law changes soon.

Ah OK.

In this particular case, that is a shame. I understand why it's not possible, and rightly so to protect the rights of tenants, but in OP's case it would be much more helpful if it was possible!

Even if it were allowed, how in practical terms would that work? At the end of the fixed term you can drag them out and throw their stuff onto the street?

I suppose it would be trespass/squatting, if they were living in a flat they had no right to live in?

You'd still need to go through the court to evict them, you'd just be using a different area of law to do it and you wouldn't be able to recover rent.

I agree that you would as the law stands.

But if a company overstays its commercial lease, say, it might be possible for the landlord to disable all their entry passes before taking them to court for non payment etc. I suppose the equivalent if rolling leases weren’t automatic would be the landlord having the right to enter the property once it wasn’t under lease and change the locks/remove the tenants’ items to a safe place.