With rents higher than ever, our short guide for landlords solves the problem of "What questions should I ask a guarantor."
If a potential tenant doesn’t pass their financial or credit check, or you’re concerned about their ability to pay rent and bills, you may ask them to provide a guarantor. Here's what to ask to ensure affordability.
1. Are You a UK Homeowner?
A guarantor should be someone that owns and lives in their own property in the UK.
If they live abroad, chasing payments can sometimes be tricky. If they don’t own a property in the UK, it is difficult to understand their financial situation and credit score. It's also crucial that you understand their overall affordability.
2. Have You Been a Guarantor Before?
This is a great question to ask to understand how familiar the person is with being a guarantor. If they haven’t had this experience, it doesn’t mean you shouldn’t go ahead. It does mean you must explain the process in more detail to confirm they fully understand the agreement.
If they have been a guarantor before, ask for more details. Find out who it was for and if they ever needed to make any payments for the tenant.
3. Are You Becoming a Guarantor for One Person or Joint Tenants?
If the guarantor is happy to be responsible for joint tenants, they’ll be liable to pay if any (or all) tenants don’t pay. However, some guarantors may only wish to be responsible for one tenant, so make sure this is clarified and understood.
4. Do You Understand Circumstances in Which You Will be Asked to Pay Money?
You want to ensure the guarantor has read the agreement and fully understands when they may be liable for payment. While a tenant may have asked the guarantor this question, you should do your due diligence to ensure they are prepared for the commitment.
Usually, you’ll only need to ask the guarantor for payment if the tenant doesn’t pay rent or utilities or damages the property significantly. So, be specific about the circumstances and potential costs to ensure they fully understand their responsibilities.
5. How Long Are You Prepared to Be a Guarantor?
You’ll need to agree on how long the guarantor agreement will last. If the tenancy agreement is fixed-term, the guarantor can specify whether it will only last for that fixed term – or beyond if it renews or becomes a rolling tenancy.
Get Expert Help
At Horts, we are your local property management experts in Rugby and it's our job to know all the answers to "What questions should I ask a guarantor." We offer letting and property management services and complete tenant referencing checks giving you, the landlord total peace of mind.
Our friendly team can help. Call us today on 01788 550044 or browse our letting agent services here
