When you’re starting out in New York City, proving that you’re financially responsible can be a challenge. That’s why many young adults looking for housing in the city will probably need a "guarantor" because an apartment is a big financial commitment.
Plain and simple, a guarantor acts as a guarantee that the rent gets paid during a situation when the tenant can't meet their financial commitment.
Below we break down the basics: what guarantors do and why you may need one.
What Is a Guarantor for an Apartment?
A lease guarantor is someone -- a family member or financial company -- who legally agrees and guarantees payment on the lease if it couldn’t be paid for some reason.Do I Need a Guarantor to Rent?
Most renters in NYC need to prove they make 40 times the monthly rent. For example: If the apartment you want to rent costs $3,500/month, you would need to make a salary of $140,000 (3500 x 40 = 140,000). If you don't make 40x the monthly rent, a guarantor may be able to step in to secure the new place.Other reasons why a landlord might ask the potential resident for a guarantor include:
- You have no credit history or have a poor credit score due to previous defaults or bankruptcy.
- You’ve moved around a bit or have just returned from abroad.
- You can’t obtain a sparkling reference from a former landlord.
- Also, if the applicant does not meet the financial requirements or credit test, a landlord will require a guarantor on the lease.
Written by Amber James