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Tenant Guarantor

How do I get my FREE tenant guarantor forms?

You can download all the tenant guarantor forms within our free landlord software – Property Manager.

What is a tenant guarantor?

A tenant’s guarantor is somebody who agrees to be responsible for another’s debt or performance under a contract, if the other fails to pay or perform.  In the case of a landlord it is most common when the landlord is unsure that the tenant can pay the rent (normally because they are relatively young and have insufficient credit history as in the case of a student; or where the prospective tenant has an unsatisfactory tenant credit history). In these cases a landlord is advised to ensure that a more credit worthy individual takes responsibility for the tenants’ rental payments.

Tenant guarantors are most commonly a close relative such as a parent.  What you really want in a guarantor is that they own their own home and have a significant amount of equity in their property.  This is good for two reasons.  Firstly, if the guarantor owns their own house they are unlikely to do a midnight flit and disappear.  This means when it comes to serving any legal documents on them should it come to the enforcement of the guarantor agreement you have a permanent UK postal address to use.  Secondly, the fact that your guarantor has equity in their property means that they have ‘dosh’.  This means that if you successfully enforce a court order against them, you have a reasonable chance of having your debts settled in full and not the 5 pence a week you might get if you are successful in taking proceedings against a ‘bankrupt tenant’.  You can check that the guarantor owns their own home by doing a search on the Land Registry website.  It costs £4 to execute.

What guarantor forms do I need?

The essence of a guarantor form or forms is that it attaches the performance to that of the tenancy agreement and that it sufficiently evaluates the credit worthiness of the guarantor (there’s no point in having a guarantor that is bankrupt as well as a penniless tenant.)

Where do I get tenant guarantor forms?

Property Hawk has produced it’s own set of FREE guarantor forms for use by Property Hawk registered users.  The guarantor forms consist of:

1. Deed of Guarantee

2. The tenancy agreement

3.  Guarantor Letter

4. The Guarantor Application

How to access our tenant guarantor forms

To use Property Hawk’s guarantor forms you will just need to register and then login to Property Hawk Property Manager and click on the forms button on the left hand side.

Getting the guarantor forms

Start the process by selecting two of the standard forms: the Guarantor Letter and the Guarantor Application.  Both of these need to be filled out by hand and include the details of the tenant and the guarantor.  In addition to these standard forms you will also need a Tenancy Agreement and Deed of Guarantee.  To create both of these forms you will first need to add a property and a tenancy with the details of the property and the proposed tenant.  To create the Tenancy Agreement and Deed of Guarantee select the my forms drop down and click on the + ikon to create both of these forms.  You then have the option with all the forms to email them directly to your tenant or proposed tenant guarantor or to save them onto your computer and then send them as a PDF attachment.

Obtaining a tenant guarantor

Firstly, before going through the process of getting a tenant guarantor remember it will only be worth it if your guarantor is financially stable and has assets.  Otherwise you could be swapping a chase through the courts after your tenant with that of the guarantor (all to little effect).  To start with you should carry out a credit check on the guarantor.  Having downloaded the full set of guarantor forms you now need to send two copies to the prospective guarantor.  One they keep and the other they send back to you the landlord.  The guarantor letter is by way of an introduction.  It is essential that they return a signed and dated copy of the tenancy agreement.  The essential thing with a deed is that it needs to be signed, dated and witnessed for it to be legally binding.

Hidden advantage of the guarantor forms

Some landlords, such as Terry Samuels, who lets to student tenants; use guarantor forms as a method of avoiding having to take a tenancy deposit and comply with the onerous Tenancy Deposit Scheme (TDS). Terry charges an administration fee to set up the tenancy, in much the same way as a letting agent would.  With the security of a legally executed deed should a landlord need to make a charge for any damage to their buy-to-let property they can claim against the guarantor rather than having to try and deduct it from a tenancy deposit.  Property Hawk would like to acknowledge Terry Samuels who very kindly let us use his guarantor forms from the outset.

The ideal tenant guarantor

The ideal tenant guarantor is most likely to be a well heeled middle class parent who would shudder at the thought of little Johnny failing to pay his rent on time (the shame!).  However, let’s not get too prescriptive.  It could well be a character such as ‘Big John’.  Now Big John is no oil painting.  He maybe somebody you wouldn’ t normally deal with but he could well be a landlord’s secret weapon.
John is 6ft 5 with tattoos and works out.  It’s fair to say nobody messes with ‘Big John’. If the tenant stops paying the rent you send the tenant a letter reminding them of the non-payment of rent with a copy to ‘Big John’.  If after this no rental payment is forthcoming then you reluctantly have to approach ‘Big John’ for the money. Now ‘Big John’ ain’t going to be happy that he has to cough up money for the tenant and also potentially face damaging legal action in the courts.

Whilst landlords who chase they tenants for rent by such innocuous action as phoning them or faxing them are potentially open to charges of harassment.  ‘Big John’ is not encumbered by such petty rules!  He just goes directly to the tenant and ‘reminds’ them of their legal obligations to pay the rent.  Sure enough ninety nine times out of a hundred the rent suddenly materialises and the tenancy is once more on track.

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