Joint and several liability protection for parents
Do you know the risk of standing as guarantor under joint and several liability agreements?
If you are planning on being the rental guarantor for your child in a shared property, you need to know about ‘joint and several liability agreements’ and how to protect yourself against the potentially large financial risk you could be setting yourself up for. Read on to find out more about being the guarantor for shared tenancy properties…
Join tenancy agreements explained
Whether your child is starting university in student halls or moving into private accommodation with letting agents and landlords, there are some standard renting practices that must be recognised to fully understand the risk of being a parental guarantor. The first, and most important part of the process to look for is whether you and your child are signing a ‘joint and several liability contract’. This is the typical type of rental agreement a tenant and their guarantor will sign when they are a renting a property in the UK. It states that everyone in the property is equally liable for each others’ share of the rent. If for any reason, on tenant wasn’t able to pay their rent (known as going into rent arrears), the other tenants and their guarantors would have to continue paying the missing share of the rent.
Why are student’s parental guarantors at the most risk?
There are a few contributors to the reason why rent guarantors of university students are at higher risk of having to pay out rent arrears. Firstly, in this modern age, it has become very easy, and widely accepted to sign contracts electronically. This is particularly common for students parental rent guarantors because the child will most often be in a different city or country even. This creates increased risk under joint and several agreements because the parental guarantors may find themselves at risk of having to pay out on rent arrears for tenants they may have never met! Therefore the parent or guardian may not be able to make a decision on the risk they are taking on with a child’s ‘new friends’ who may have only known each other a few months.
Another factor to consider is that students may drop out of university, resulting in them leaving to return home or find another direction elsewhere. It is sad to say that this is a high possibility and can have larger consequences for the other tenants and their guarantors than the individual may initially comprehend.
Apply to Only My Share to protect yourself and your child from the risk of paying out for another flatmate’s rent arrears for as little as £99 for the whole year.