You might be familiar with the terms “cosigner” and “guarantor” if you are a Bangor renter. But what do they really mean? And what makes the two different from one another? We will outline the distinctions between cosigners and guarantors in this blog post and offer advice on how to approach friends and family for assistance.
What is a Cosigner?
A cosigner is a person who signs a lease with you and promises to pay the rent if you are unable to. A cosigner is regarded as another tenant, even if only on paper. In order to be able to legally occupy the rental property, a cosigner must sign the lease with the tenant. A tenant’s financial obligations, such as any potential fines, unpaid rent, or property damage, can also be shared by this person. In the majority of cases, a cosigner will have better credit than the renter and a significantly higher income, as they will need to display up to six times the amount of rent to qualify. Young or first-time renters may find it much easier to qualify for a rental home with a co-signer.
What is a Guarantor?
In contrast to a cosigner, a guarantor agrees to pay your rent only if you are unable to. A guarantor is not regarded as a tenant and does not have the same privileges as a co-signer. A guarantor can be viewed as a financial safety net in the event that the tenant is unable to meet his or her financial obligations. Like a co-signer, a guarantor must show income that is at least 6 times the monthly rent.
Key Differences
The primary contrast between a cosigner and a guarantor is that a cosigner is legally accountable for the rental property, whereas a guarantor is only financially accountable. If the tenant does not pay rent or make repairs to the property, the guarantor is financially responsible. A cosigner, on the other hand, is accountable for paying the rent regardless of whether or not the tenant pays.
Why You Might Need a Cosigner or Guarantor
You might require a cosigner or guarantor for a loan for a few different reasons. Perhaps you’re new to renting and haven’t built up any credit yet. Or perhaps your credit score has declined as a result of financial difficulties. Whatever the reason, you might need to ask a friend or member of your family for assistance if you can’t get approved for an apartment on your own.
How to Ask Someone to Help
It’s important to be open and truthful when asking someone to cosign or serve as your guarantor. Describe your need for assistance and what would happen to them if you were unable to make rent. A copy of your lease agreement or proof of your income should be provided, as well as any other pertinent paperwork. Lastly, ensure that they are aware that they could be held accountable for paying your rent if you cannot. Because of this, it’s best to select a reliable and financially secure person.
A big choice is making someone your cosigner or guarantor. However, the right person will be happy to assist you if you are honest about your financial situation and outline the risks involved. You can contact one of our Bangor property managers if you have any further inquiries.
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We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
