The accidental landlord: when rental references suggest otherwise, a guarantor calms the jitters

When you believe your tenant can cover the rent but references suggest otherwise, a guarantor calms the jitters.

What do you do when you think you have found the perfect tenants for your property but a reference report urges you to decline them?  Should you go ahead and let them move in — or tell them to find somewhere else to live?
I suppose it really depends why they failed the referencing. If it is because they have got county court judgments against them or a history of bad debt, then I would definitely turn them away. But tenants can fail for other reasons, such as their previous landlord not bothering to confirm their address, or, quite often, because their income is too low in comparison to the rent.
After weeks of trying to let a property I found a lovely tenant, but she wasn’t deemed acceptable by the referencing agency because her salary was a little shy of twice the rent, which was the very minimum required to pass their “affordability test”.
I could have said: “Bye-bye, on your way,” but I wanted to go with my gut instinct and let her have the flat  anyway. I considered asking her to pay six months’ rent in advance and a two-month deposit, then, as long as I inserted a six-month break clause in the tenancy agreement, I could boot her out with two months’ notice if she defaulted on the rent in the second half of the term.
However, this seemed a bit harsh, given her meagre salary, so instead I asked her to provide a guarantor and her mum obliged.
A guarantor promises to cover the rent if the tenant won’t or can’t pay, and they are also legally bound to refund the landlord if the tenant causes any damage to the property or does a runner with the furniture. Essentially, the guarantor takes on all the responsibilities of the tenant.
To be any use at all, a guarantor must be based in the UK and ideally they should be a homeowner or at least have sufficient income to cover the rent. A letting agent recently tried to fob me off with a tenant who was offering to put up his father as a guarantor, even though the father was French and living in Paris. Now, I’ve nothing against Frenchmen, I think they’re rather splendid, but if the tenant had defaulted on the rent and Papa had given a Gallic shrug, I knew it would be nigh on impossible to recover any money via the French courts, so I said: “Non, merci,” to that suggestion.
Even with a UK-based guarantor I thought it might be tricky sorting out the paperwork, but actually it was easy-peasy. I ran a separate credit check on the tenant’s mum and downloaded a Deed of Guarantee form which I found on this fab website, Property Hawk (, which has lots of other documents for landlords, many of them free. 
I emailed a copy of the deed, along with a copy of the tenancy agreement, to the mum for her to sign, scan and email back to me.
Two things to remember with a Deed of Guarantee: it must be signed BEFORE the tenancy agreement is signed by the tenant, and the guarantor’s signature MUST be witnessed.  I am told that it’s fine to accept digitally signed documents, which helps if the guarantor doesn’t live locally. Guarantors don’t sign the tenancy agreement itself, but they should see a copy so  that they know exactly what they are agreeing to.
Then all you have to do is attach the Deed of Guarantee to the tenancy agreement signed by the tenants — and cross your fingers that you never have to use it.

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