Question on Guarantor affordability and Checks

Landlord Discussion
1

Hi

I have a question on the below:

  1. Tenant 1 - passed affordability but has CCJ, explanation on this was reasonable
  2. Tenant 2 - failed affordability but did warn that has a new business with contracts starting in a month which will cover
  3. Guarantor failed affordability

The reason I did the 3rd point above was because I was debating on taking out RG insurance. My head tells me if I see the contracts starting in September then that should cover the affordability and lessens my concern. As all else seems good.

I’d like thoughts and options on the following:

  1. check if guarantor is a homeowner and therefore, if I do want RGI, im eligible
  2. work on a 2-3 months rolling rent basis

I’m conscious that no one is perfect and quite frankly believe that those that are would be equally a risk. It’s a family and the family have no history of defaulting on rent or bills, etc.

2

Tenant 1 has a CCJ not a good start
Tenant 2 may have a new business and new contracts starting soon but are they guaranteed and for how long starting s new business in this economy can be hard what if you give him the benefit and the contracts don’t sign or his business folds?
And no 3 is self explanatory
You say they are a family and that the family ha e no history of defaulting how do you know do you know them personally (again not always the best to let to)
Have you seen proof of the CCJ and that it is being satisfied?

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3

Thanks
Tenant 1 - I’d agree re: proof that it’s being paid off.
Tenant 2 - has signed contracts to start and they are government.
Guarantor - this is what concerns me, but wondering realistically how often guarantors really do end up paying up.

No I do not know them personally. I’d think that as much as you can do checks, there’s no history with the exception of the CCJ.

4

Personally (and may i stress i am.NOT and NEVER HAVE BEEN a ll) the fact that it was government contracts (however large or small) still wouldnt sway it a lot can happen in Government and fundings can be withdrawn or contracts can be scrapped etc
As for the CCJ do you know WHY the person has it and how long they have left to pay it
And as per guarantors I dont know the answer however I would think its more than you or i imagine

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5

without a guarantor, I wouldn’t proceed. Even with, I’d not take T2. It’s past record and current situation that count. No one knows the future.

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6

Thank you both. Helpful to get others perspective on this as well.

7

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