Can The Council Help With A Guarantor?
By
HuutiMoney
Finding a guarantor for your rental deposit or advance can sometimes be a challenge especially if you are independently renting for the first time. Through this article, we aim to learn whether or not the council can help with a guarantor and if not, what alternative support you can expect from them. In addition to this, we will also discuss the eligibility criteria for a guarantor as well as the alternate options available to someone who is unable to find one.
Can The Council Help With A Guarantor?
The council may not be able to help you with a guarantor as the role of a guarantor is to give surety to the landlord or letting agent of a private tenant that they are responsible for the rental payments of a tenant; should the tenant be unable to make these payments on time or on a regular basis.
Guarantors are needed by private tenants if they are unable to pay their rental deposit or advance or if their bank statement indicates low or irregular income due to which a landlord or letting agent is uncertain about their ability to pay their rent on time and on a regular basis.
Therefore, there is a financial risk for someone who chooses to be a guarantor as they would not only be responsible to make rental payments on behalf of a tenant but can also be taken to court by the landlord in the case of rent arrears by the tenant.
This is the reason why guarantors are usually friends or family members of a private tenant who take responsibility for the tenant’s ability to make timely and regular payments to landlords of a privately rented property.
If you are a student who is seeking a guarantor due to a lack of credit history or since you are renting for the first time, you can check with your University if they offer a Rent Guarantor Scheme. In such cases, the University acts as the guarantor on behalf of their students for Short Assured Tenancy or Private Residential Tenancy, if they are unable to find a UK-based guarantor.
How Does The Council Help A Private Tenant?
If someone is struggling to pay a private rental deposit or advance, the council can provide them with financial support with a rent guarantee scheme, a rent deposit scheme, a homelessness prevention fund, put them in contact with social services, arrange grants through charities and offer Discretionary Housing Payments; depending on the applicant’s circumstances and eligibility regarding these options.
If you claim any of the following benefits, you can apply for a Budgeting Loan through your council to pay your deposit for private rent:
- Income Support
- income-based Jobseeker’s Allowance
- income-related Employment and Support Allowance
- Pension Credit
Who Can Qualify To Be A Guarantor?
In order to qualify as a guarantor, an individual should be able to meet the below criteria:
- should be more than 21 years of age,
- have a good credit history
- indicate financial stability with their financial records
In addition to this, if they are a homeowner, it will be considered a plus point.
If someone is retired, on a low income, has a bad credit history or lives abroad, the council authorities will most likely reject them as a guarantor.
What Should I Do If I Can’t Find A Guarantor?
If you are unable to find a guarantor, you can seek help and support from your local council office. They will be able to offer you financial support in the following ways:
- A Rent Deposit Scheme through which financial aid is extended to those who cannot afford a rent deposit. The applicant receives the entire amount in advance and repays it in instalments.
- A Rent Guarantee Scheme that provides a written guarantee to your landlord confirming your inability to make an immediate cash deposit and your commitment to pay the amount over some time.
- A Deposit Replacement Scheme gives tenants the option to make alternate payments instead of the tenancy deposit. They have the option to make a one-time lump sum payment instead of their tenancy deposit or pay an extra amount on top of the monthly rent.
- There is also the option of Discretionary Housing Payments extended through local councils. Being at the discretion of council offices, these are one-time, non-refundable amounts for residents claiming Housing Benefits or Universal Credit and may be used to make housing payments.
Conclusion:
The above discussion brings us to the conclusion that while council authorities offer support through grants and rental payment schemes, they may not be able to find a guarantor for you due to the financial risk associated with being one. Therefore, tenants will mostly have to rely on friends and family to be their guarantors. On the other hand, University students looking for a guarantor for their rental advance or deposit can seek support from their University if they run a Rent Guarantor Scheme.
FAQs: Can The Council Help With A Guarantor?
Who can be my guarantor?
Anyone who is living in the UK, IS more than 21 years of age, has a good credit history and indicates financial stability through their financial records can be your guarantor. However, it is usually friends or family who will accept to be one due to the high financial risk associated with being a guarantor.
Does a guarantor need to be employed?
While it is not essential for a guarantor to be employed, it is expected that they have a regular source of income or sufficient savings to step in for rental payments if a tenant fails to do so.
How much does a guarantor have to earn?
While there is no fixed amount that a guarantor is required to earn; however, most landlords expect a guarantor to earn 40 times the value of the rent. If they are homeowners, this amount can be significantly reduced.
What happens if a guarantor cannot pay rent?
If a guarantor cannot pay rent, they can be taken to court by the landlord. This is a consequence that guarantors are made well aware of before they agree to take the responsibility; which is mostly done in writing.
Do guarantors get credit checked?
Yes, guarantors get credit checked in the same way as a tenant as. The reason for this is that someone with a bad credit history will not be eligible to become a guarantor for another individual.
References:
Guarantors for private renters – Shelter England
Being a Guarantor | Who Can Be One & What It Means | Experian.
Using a guarantor – Citizens Advice