Renting to students can be both rewarding and challenging for landlords. While students bring vibrancy and energy to rental properties, they also come with unique risks, primarily due to their limited credit history and inconsistent income. This is where guarantors play a crucial role in ensuring a secure tenancy.
A guarantor is someone who agrees to pay the rent if the tenant is unable to do so. This provides landlords with added security and peace of mind. Typically, guarantors are parents or guardians who have a stable income and a good credit history. For landlords in London, Ontario, requiring a guarantor when renting to students can significantly reduce the risk of financial loss.
The practice of requiring guarantors is particularly prevalent in cities with large student populations. Given that London is home to Western University and Fanshawe College, it’s common for landlords to request guarantors as part of the rental agreement. According to a survey by Rentals.ca, over 60% of landlords renting to students in university towns require guarantors as a standard practice.
Having a guarantor not only benefits landlords but also students. It provides them with the opportunity to build a rental history, which can be beneficial for future rentals. It also helps students secure accommodation that might otherwise be out of reach due to their lack of financial stability.
When drafting a lease agreement, it’s crucial to clearly outline the responsibilities of the guarantor. This includes the conditions under which the guarantor will be held liable for rent and any other financial obligations. Both the tenant and the guarantor should understand and agree to these terms before signing the lease.
For more insights on student rentals, explore LSK Property Management’s homepage.