Student housing - using a guarantor
Many private landlords want a third party to act as a guarantor for the rent payments before they'll agree to let a property to a student.
It's important for anyone considering being a guarantor, or for a student who needs to ask someone to be a guarantor, to fully understand what's involved. This page provides information on what you need to be aware of. You should always seek legal advice before organising or becoming a guarantor. Your bank may be able to provide you with a standard guarantor agreement.
What is a guarantor?
A guarantor is a third party, such as a parent or close relative, who agrees to pay your rent if you don't pay it. Your landlord can ultimately take legal action to recover any unpaid rent from your guarantor.
Your landlord may want to check that your guarantor is able to pay the rent in the same way that they've checked your ability to pay, for example, by carrying out a credit check. Administrative work undertaken by the landlord on this should not involve you or your potential guarantor being charged any fees. These fees are unlawful in Scotland.
A legal agreement sets out the guarantor's legal obligations.
Is a guarantor only liable for unpaid rent
In many cases, a guarantee agreement extends to other conditions under the tenancy as well as rent due, for example, any damage caused to the property. If you are asked to pay for the damage, as the tenant, but you don't pay it, the guarantor could be asked to pay it.
It is advisable to check the tenancy agreement before you act as guarantor. It is important that you know, as guarantor, what the tenant has to actively do and not do to maintain the tenancy. This should be covered in the tenancy agreement.
Does the guarantor have to live in the UK
Landlords will usually want a guarantor who lives in the UK as it's easier for them to take legal action against a UK resident if they need to. There are reciprocal agreements within Europe for court orders to be enforced. This may make it more reasonable for a landlord to accept a guarantor within Europe. There is more about these orders on the website of the Scottish Courts and Tribunals Service at www.scotscourts.gov.uk.
Guarantors of tenants who live in shared accommodation
If you share accommodation with other tenants under one tenancy agreement, that is, a joint tenancy, it's common for the guarantee to apply to all of the rent and not just your share. In the same way, if the landlord wants to evict one joint tenant they must also end the agreements with other joint tenants.
It's best to check the guarantee agreement carefully and ask the landlord or agent any questions if something is unclear. As soon as the agreement is signed, the guarantor is bound by its terms and conditions. It is usually possible to draw up an agreement that specifies one person’s rent for a specific time period to limit the amount that is being guaranteed. You should make sure that the guarantor agreement specifies the exact amount to be guaranteed. For example, if your portion of the rent is £280 per month for a period of 12 months, the amount to be guaranteed should state this as as such, a total of £3360.
Checking the guarantee agreement
You must check any guarantee agreement carefully so that the guarantor knows how and when their liability ends. You may want to ensure the guarantor's liability is limited. For example, this can be done by specifying the start and end dates the agreement applies to.
You may find some additional help on the Shelter Scotland website at http://scotland.shelter.org.uk.
If you want to have a guarantor agreement checked by a lawyer you may have to find one locally. You can search the database of lawyers on the website of The Law Society of Scotland at www.lawscot.org.uk. You should not phone the Law Society of Scotland for legal advice as this cannot be provided over the phone.