Did you find your perfect studio apartment, but the landlord denied your rental application? Do you know why the landlord did this?
There are a couple of reasons why a property manager might deny your application. However, your financials are the major red flag for them. This includes your outstanding bills, income, and credit history.
Landlords have to protect themselves by guaranteeing that you can pay rent every month. Fortunately, you can improve your odds of getting accepted by getting a guarantor or a cosigner.
Today, we’re going to talk about the difference between a cosigner and a guarantor for your studio apartment Toronto rental.
What is a Cosigner?
Oftentimes, a cosigner is a roommate who shares the apartment. Your roommate will sign the lease with you and will also be responsible for paying part of the fees and rent.
However, a cosigner can also be someone from the outside. It doesn’t have to be a roommate. The cosigner simply has to ensure they’ll pay your rent if you’re not able to.
Compared to a guarantor, a cosigner will have more financial responsibility. In addition to that, if your cosigner is a roommate, he or she has to work hard if you can’t make rent.
What is a Guarantor?
Who will you contact if you need help? Typically, people call their close friends or family member. Usually, a guarantor is one of those categories. A guarantor will sign up to take on the responsibility of paying the damages, rental fees, or rent if you can’t fulfill your rental obligations.
A guarantor is an outside individual who signs the lease. However, he or she does not have to live with you.
Do You Need a Cosigner or a Guarantor?
Here are a couple of reasons you might have to get a cosigner or a guarantor:
The Landlord Requires It
If the landlord checks your rental application and thinks that there could be trouble in the future when it comes to paying rent every month, he or she might need a potential tenant to have a cosigner or guarantor.
Rent is Extremely Expensive
If you do not think that you can pay the rent, you should get a guarantor on board early on. This is particularly true if you love the apartment.
You can also look for a roommate to cosign the lease with you.
It’s Your First Time Renting an Apartment
Is it your first time renting an apartment? If so, you will probably need a cosigner or a guarantor to get accepted. The reason for this is that there’s a huge possibility you have little credit history for the landlord to check into.
Poor Credit Score
According to reports, a score of below 580 is poor, 585 to 700 is fair, and anything above 700 is good. Almost every person in the United States falls around 600-750.
If your credit score is less than 600, a landlord might require you to get a cosigner or a guarantor. This is particularly true if the rent is high.