Since 2011, property owners have largely enjoyed a ratio of high rents...Read more
Have you heard of cosigning companies like Insurent, Jetty, or The Guarantors? These are relatively new companies that provide renters with a co-signer (also called a guarantor) on their lease. Meaning, they will pay your lease if you are ever unable to - a bit like an insurance policy.
Many individuals find it challenging to get approved for a rental, perhaps because of increasing rental prices in their area, maybe they have a poor credit history or it could be another circumstance that impacts their economic report card. For those who have had past financial challenges, many landlords and property managers will allow for co-signing companies on their lease.
These co-signing companies can help potential tenants around what would otherwise be a roadblock to securing an apartment.
Here's how it works: for a fee, the co-signing company will guarantee your lease for a given period of time, even if your income or credit history is not ideal (note: you will still need to apply and be approved for the coverage).
In today's financial climate, this service is in demand - and it sounds great, but there are risks to consider.
Leveraging these services will add to your monthly expenses, sometimes up to 10 percent, so please do the math to make sure it's affordable and won't put any additional economic strain on your finances. Also, for some co-signing companies, if you don't qualify, the up-front fees you paid could be non-refundable - so read the policy before applying.
Also, be aware that some co-signing companies only cover a portion of your lease; an agreement may only guarantee rent for 1/4 or 1/2 of the lease... leaving you on the hook for the remainder. Check ahead of time on the terms, and understand that most apartment complexes want your entire lease covered if you opt for a cosigner.
These services are there to protect those with fluctuating work or who have overcome past economic challenges. Leveraging a co-signing service may be what you need to get that apartment you are looking for - do a bit of research and find out if this service is a good fiscal option for you!
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