What is a Guarantor and Do You Need One?
A guarantor, also called a co-signer, is someone who is willing to guarantee your lease. The guarantor is responsible for all terms of a lease in its entirety; the guarantee cannot be limited to the interest of a single applicant in a share situation. Some landlords will accept two guarantors while others may only accept one.
If you do not meet the landlords financial or credit requirements, a guarantor may be your solution. Students or individuals with no income or credit history, or anyone who does not meet the standard income requirements, will usually need a guarantor. When bad credit is the issue, whether or not a guarantor is allowed will depend on how bad the credit report is, and on how strict the management company or landlord may be. Sometimes a combination of guarantor and extra security is needed. If you are using the AptStar Program you will be advised on how to proceed in a way that will be most effective for you.
Who can be a guarantor?
A guarantor does not have to be a relative. Many landlords in New York require a guarantor to live in the Tri-State area: New York, New Jersey, or Connecticut. However there are some landlords and management companies that will accept an out of state guarantor. Please note: landlords will not accept a guarantor who lives out of the country. Prepare your potential guarantor by speaking with them and advising them of what they will be asked for. You might have to act quickly as their cooperation is critical for your approval. A guarantor needs to fill out an application form and provide the required documents. A delay in getting all required guarantor documents to a landlord may cost you the apartment. It is advisable you have these documents on-hand when applying for an apartment.
The requirements are usually good credit and double the income requirements of an applicant. If an applicant is required to show an annual income of 40-50 times the monthly rent, a guarantor is required to show an annual income of 80-100 times the monthly rent. The documents required are similar, although usually all that is needed are proof of income (usually by providing tax returns) and a credit report. Guarantors also have to sign the lease.