Guarantor-what to look out for??

[twaddle]

I have asked to be guarantor for my neice who is moving into a rented property with her boyfriend. I filled in a form with her and included my personal details, work address and bank details so thay can do a check. I haven't actually signed anything at this point and just wanted some advice on things to look out for when signing an agreement. Should it be for a short term only as I don't want to be held responsible indefinately.

[Aequitas]

It is good, for a change, to be able to have a say before someone does something, rather than after they have done it and regretted it.

Rule 1 Never act as a guarantor.

Rule 2 Remember rule 1

If you are going to ignore Rules 1 and 2, then

A. Never sign a guarantee unless it has been vetted by a solicitor and he has explained to you exactly what the effect is.

B. Negotiate so that the guarantee is not open ended - it should be limited in time (say six months) or amount (say six months' rent) and preferably both.

Do not be cajoled into standing as guarantor just because you are fond of your niece. You need to think about the possibility that your niece and her boyfriend may split up. You could then find yourself guaranteeing the rent for the boyfriend.

Do not act as a guarantor if a deposit is paid; a deposit ought to be sufficient security.

If you want to offer some help, think seriously about offering to pay a one-off rent insurance premium; it may work out cheaper in the long run.

If the tenancy agreement is signed before you are asked to sign the guarantee then forget about signing the guarantee - the agreement cannot be undone.

P.S. For the sake of completeness I add:

If guaranteeing a student letting make sure you only guarantee your son or daughter's contribution.

[MrShed]

Cant really better that advice! Good post Aequitas - I would have tipped your scales but apparently ive done that too much for you!!!

If a mod reads this, can I advise this is stickied?

[Steve__M]

How does rent insurance work in such a case?

As a landlord my partner could not get rent protection insurance for one tenant couple without a guarantor because their credit rating wasn't great.

They got a guarantor, so I'm pleased to hear that Aequitas considers it to be a serious proposition if the feckless boyfriend runs off and leaves his partner holding the babies...

[twaddle]

Thanks for your advice. I have helped them out in the past with HP and a car loan, with no problems. They have been together 5 years and have three kids(Its just that thay aren't married). He has a good job, but has a lot of CCJ's from when he lived with his mum. They had a mortgage from a disreputable company and the payments have soared(currently at 15.4%!!) so the house is being sold. The rent will be over £200 less and they'll qualify for housing benefit. I will look carefully at the agreement before I actually sign anything, providing they don't turn round and say the application is an agreement! Thanks again!