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A co-signer is a person who signs the lease along with you to assure financial responsibility to the landlord. They have a good credit score and a high income. A co-signer, however, can live in the apartment and has more rights, unlike a guarantor.
When you cosign on a lease, youre making a legal promise to uphold the terms of the lease and to pay rent if the lessee does not. As a cosigner, your credit could be affected whether or not the person youre cosigning with pays their rent. This uncertainty makes cosigning for an apartment risky.
Being a guarantor for a rental property involves you vouching for the tenant. If the tenant is unable to meet their obligations under the tenancy agreement, you (the guarantor) will be legally bound to pay out either for overdue rent or damage to the property.
Having a co-applicant can make an application more attractive since it involves additional sources of income, credit, or assets. A co-applicant has more rights and responsibilities than a co-signer or guarantor.
Cosigners have equal responsibility for payment of monthly rental costs, while a guarantor is generally sought for payment only when the property occupant is unable to make the rental payment.
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Both a guarantor and cosigner sign the lease and assume liability for paying the rent. A cosigner is responsible from day one, while a guarantor is only liable to make payments when the primary borrower cant or wont pay.
Cosigners appear on the leasing agreement drawn up by the apartment manager, but they are not required to actually live in the apartment. The cosigner is considered a backup. Essentially, they agree to pay rent for the apartment if the residents ever fall through on their agreement to do so.
An inquiry could appear on your report. Its standard for a landlord to check your credit when you cosign for an apartment, which may appear as a hard or soft inquiry on your credit report. A hard inquiry could lower your credit score by a few points for up to 12 months.
A guarantor guarantees to pay a borrowers debt in the event that the borrower defaults on a loan obligation. The guarantor guarantees a loan by pledging their assets as collateral. A guarantor alternatively describes someone who verifies the identity of an individual attempting to land a job or secure a passport.
Theres no general rule about how long a guarantor agreement lasts. It depends on whats agreed between the landlord and the guarantor. Your guarantor should speak to the landlord if they dont want their liability to continue beyond the end of a fixed term tenancy.

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