Not being able to find a lease guarantor is a big problem for some tenants who want to stay in high-rent areas but don’t have the required income. Strict income requirements are a reality, particularly in the pricier areas of big cities. Unemployed or underemployed tenants often feel the squeeze of a rental agreement that requires a salary of up to three times the monthly rental amount. Landlords and rental companies add income requirements to tenant applications in order to be sure that tenants can afford to pay the rent on a space.
Why Lease Guarantors Can Be Hard to Find
The lease guarantor in a rental agreement is on the hook for all unpaid rent and other financial responsibilities if the tenant does not pay. That makes signing as a lease guarantor an unappealing option for most individuals. Even the most devoted friend or family member may have their own reasons for declining a request to sign onto a lease as the guarantor. The tenant may see this addition as a technicality, promising that he or she can pay the rent, but the risk involved discourages most people from agreeing to become the lease guarantor.
Looking Beyond a Lease Guarantor Agreement: Alternative Deals
Some tenants who cannot secure a lease guarantor can get approved in other ways. Those who don’t have the required employment income or good credit can sometimes secure an apartment space using proof of savings and assets, or in some cases, through a kind of “escrow” deal where money is held in an account to pay future rents. Some informal rental contracts can rely on other types of income such as alimony, child support, or a windfall such as a legal award or inheritance.
Other Solutions for Cash-Strapped and Credit Poor Tenants
Eventually, some of the tenants who can’t find ways to get approved will need to lower their sights. Sometimes, staying in a desired neighborhood means renting less space, getting less amenities, or otherwise dialing down the costs of rental. One common solution is rental spaces that offer communal living setups. Communal living is a way that people all around the world live more simply and for less cost. This setup has its own pros and cons, but it can offer a good amount of financial relief to those who are tired of paying sky-high prices just to cover the monthly rent.
In the end, getting around credit and income requirements is often a matter of creativity and foresight. Tenants need to be able to see the big picture, figure out what they can afford, and then find a good match for their financial situation. Those who are stuck on a specific result may get frustrated when things don’t seem to “pan out,” but casting a wider net often allows these troubled renters a better chance at finding at least a temporary solution. Seeing a less desirable living situation as temporary can help those who are going through a time of unemployment to put things in perspective and come out financially solvent on the other side.