Guarantor or ad tenant

1 Reply

We have decided to rent to a tenant with less than stellar credit and his boss has agreed to guarantor the loan so that he won't have to pay an additional 3 mo security.  I've not done this before and wonder if you have any experience or hints for me.  Would it be adventageous to ad him as a tenant instead?  Any "red flags" to look out for?  

Originally posted by @Dawn Vacek :

We have decided to rent to a tenant with less than stellar credit and his boss has agreed to guarantor the loan so that he won't have to pay an additional 3 mo security.  I've not done this before and wonder if you have any experience or hints for me.  Would it be adventageous to ad him as a tenant instead?  Any "red flags" to look out for?  

Loan? Are you a lender or are you a landlord? If a third party is willing to be responsible in case of tenant default, then put them as a co-signer on the lease/rental agreement, not as a co-tenant. Put the proper paperwork in place to make the agreement enforceable. If the co-signer doesn't have sufficient credit and sufficient assets, pass. However, it is always better to obtain a sufficient security deposit to cover your risk. Chasing down co-signers is not so easy.

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