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?

I know OP is getting bored with this this. But just to add weight to anyone coming to this in the future for advice.

I worked in debt recovery for a large letting agent. It always astounded me the proportion of guarantors that I spoke to who thought it was just a formality and were surprised and shocked about how strongly and persistently we would pursue them for the rent- and often how the person they had signed on for would not be able to help them to deal with it.

Yes indeed. If the law made it much easier and quicker to regain their property if tenants don't pay, and if the housing element of UC were paid direct to the landlord, then it would be a hell of a lot easier for everyone to rent. The risks would be much, much lower so more potential tenants would be considered. Also being a landlord would be less risky, so there would be more properties to rent.

But that's the opposite of the way the law is going. Because of it landlords are leaving the market. So fewer properties to rent, which equals higher rents. And because of the huge risks landlords need to bear they will be ultra picky about tenants.

So while all the pro tenant and anti landlord laws are great for tenants in situ, they will have a lot of unintended consequences for those looking to rent.

100% agree, @thecatneuterer - I wouldn’t contemplate being a landlord because of all the above

Absolutely agree.

… and concentrate the rental stock in the hands of bigger corporate players (who will hoover up the small landlords’ cast-offs) and use their commercial muscle to fix the market and make things even worse for renters.

Oh yes, that too.

We have a fixed term rental period for our office so at the end of the tenancy we have to be out or we negotiate a new lease.

I know commercial is different than residential, but in cases like OP's, or for someone, for example, that's renting a property while theirs is being refurbished, a fixed term rental, paid up front, would be a helpful option.

While I know many rules are in place to protect tenants from dodgy landlords, I know there is also a chance of dodgy tenants that refuse to leave at the end of their agreement too which leads to the hassle of eviction, but that could happen with either a fixed or rolling contract.

I don’t understand why they are asking for a guarantor when you are paying the full rent upfront? I’m a landlord and all we do is a credit check and make sure their salary is above a certain level.

Because all residential tenancies automatically go month to month at the end of the fixed period and if the OP never pays another penny rent after the upfront payment, will still take the landlord 12 to 18 months to get her out.

They want someone else on the hook for 18 months rent, court fees and any damages.

Well no, not really. Once the initial tenancy agreement is up the guarantor can be released. Guarantorship lasts until the end of the initial rental period or until something changes in the agreement, such as a rent rise. Unless there is something specifically to the contrary in the agreement.

Yes? Most rental contracts contracts do have ‘something to the contrary in the agreement’. That’s why they are used with an upfront payment. They bind the guarantor as long as the tenant lives in the property whether that’s 6 months or 20 years.

No. It depends on the agreement. The standard NRLA agreement lasts until the tenancy ends or until a new contract is drawn up. If the tenancy goes to periodic, or if the rent is increased using that form that I can't remember the name of, the guarantor is still liable.

@IWillAlwaysBeinaClubWithYouin1973 As many others have said, I would only agree to be a guarantor for my own children.

But I think it's absolutely ridiculous that you are being asked to provide one.

As this thread shows, most people would only be a guarantor for their children, so where is a 62 year old supposed to find a guarantor?

I think it should be illegal for landlords to require a guarantor from renters who have a stable income. It's just making it unnecessarily difficult for people to house themselves.

Fair enough. As long as it's also illegal for tenants to stay for a year or more without paying any rent.

You can serve an eviction notice after two months of non payment.

Of course you can. And the average length of time from that to eviction is a year. Longer if the tenants know how to play the system or if you're in an area with exceptional court/bailiff backlog.

Well these are the kind of risks you should bear in mind when deciding to be a landlord.

Being a landlord is optional. Having somewhere to live isn't.

And it then takes 12 to 18 months to get them out. Most landlords can’t manage 14 to 20 months of non payment so they need someone with assets to bill while they are getting the non paying tenant out.

This has all been addressed in the thread already.

If they are overstretching themselves then they can sell up and not be a landlord.

The landlord doesn’t have to bear these risks in mind - there is a perfectly legal and practical way to address the problem - namely requiring a guarantor.

And in the meantime, where are grown adults who don't have anyone else willing to pay their rent for them supposed to live?

They can’t sell up with an overstaying tenant in situ, though.

Or they could mitigate the risk and require a guarantor.

One person who did have to pay out as a guarantor has said she ended up paying £54,000 to compensate the landlord. Very very few people can afford that sort of loss.

Nope. I’m afraid I would not do it

Like I said, these are the kind of risks they should bear in mind when deciding whether or not to be a landlord. What would they do if their property was empty and they couldn't find a tenant?