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Guarantors: is it easy to enforce a payment?

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  • 30-07-2018 1:05pm
    #1
    erudec
    Registered Users Posts: 239 ✭✭


    If some tenants sign a contract with voluntary guarantors ( probably parents), is it straightforward to make the guarantor pay if the tenants stop paying their rent?

    Is it usually just a case of going straight to the district court and obtaining a swift order for the guarantor's bank to pay the outstanding balance?

    Or are guarantors able to paralyze the process with a sob story?

    If possible, people with direct personal experience of the process would be more informative than those without.


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    #2
    Stanford
    Registered Users Posts: 1,181 ✭✭✭Stanford


    Provided the guarantors sign the necessary legal documents it is an easy matter to get a judgement in the District Court, most Judges won't be swayed by a "sob story".


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    #3
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    I'm not 100% on this but I expect your would still have to go through the RTB before enforcing anything on the guarantors in the District Court.


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    #4
    cruizer101
    Registered Users Posts: 3,205 ✭✭✭cruizer101


    Never heard of guarantors for renting before only for mortgages.
    I'd be surprised if a landlord would enter into such an agreement, the only reason for a guarantor would be if there was some doubt of the actual tenants ability to pay and if that was the case why go through the hassle when you could just get tenants who you don't have to worry about paying, especially in today's market where willing tenants who can pay are ten a penny.
    Seems like unnecessary hassle to me.


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    #5
    antoinolachtnai
    Registered Users Posts: 9,792 ✭✭✭antoinolachtnai


    You could put them down as a tenant on the lease. The palaver to make them a guarantor might be a bit much.

    You would have to go through the RTB.

    I would be surprised if the District Court would give you the order you envisage.


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    #6
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Michael D Not Higgins wrote: »
    I'm not 100% on this but I expect your would still have to go through the RTB before enforcing anything on the guarantors in the District Court.

    There is no need to go to the RTB to enforce a guarantee. All that is necessary is that there is a demand on a tenant and it is not paid. The RTB only deal with disputes between landlords and tenants, not landlords and third parties. Many landlords are demanding guarantees before letting so they can institute action against the guarantors in court immediately if there is a default. The District Court deals with claims up to 15K. I was once asked for a guarantee by a potential landlord on a residential premises. Just because a tenant can pay, doesn't mean they will pay. There are plenty of chancers gaming they system. There is no reason the District Court would refuse to give judgement if the requisite proofs are in order.


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    #7
    Del2005
    Registered Users Posts: 18,990 ✭✭✭✭Del2005


    antoinolachtnai wrote: »
    You could put them down as a tenant on the lease. The palaver to make them a guarantor might be a bit much.

    You would have to go through the RTB.

    I would be surprised if the District Court would give you the order you envisage.

    Having someone on the lease doesn't mean that they have to pay rent, the RTB doesn't chase non paying tenants.


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    #8
    JustAThought
    Registered Users Posts: 5,324 ✭✭✭JustAThought


    A contract is a contract. Nobody has a 'voluntary' get out of paying clause - including guarantors. I see the new student accommodation blocks in Dublin require annual rent paid in full up front or a screened guarantor - who will be called on to cough up if the paymentsl schedules are not adhered to. They will not thank you for a judgemnt made against them or court summons - which can affext their credit history and ability to take on certain jobs and get work or travel visas. Its a serious business.


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    #9
    Del2005
    Registered Users Posts: 18,990 ✭✭✭✭Del2005


    JustAThought wrote: »
    A contract is a contract. Nobody has a 'voluntary' get out of paying clause - including guarantors. I see the new student accommodation blocks in Dublin require annual rent paid in full up front or a screened guarantor - who will be called on to cough up if the paymentsl schedules are not adhered to. They will not thank you for a judgemnt made against them or court summons - which can affext their credit history and ability to take on certain jobs and get work or travel visas. Its a serious business.

    The RTB would disagree. How many tenants have had orders made against them for non payment of rent?

    The other problem in this country is the time and effort required to get a judgement in your favor, then you have the time and effort to get it enforced.


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    #10
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Del2005 wrote: »
    The RTB would disagree. How many tenants have had orders made against them for non payment of rent?

    The other problem in this country is the time and effort required to get a judgement in your favor, then you have the time and effort to get it enforced.

    A guarantor has something to loose- a tenant doesn't. The reason for it being a screened guarantor- is to ensure they are aware that there will be reprecussions if the transaction they are acting guarantor on goes south- and they will be held to account for it.

    No point in the RTB making orders against tenants or chasing them- they'll just claim penury and its a complete waste of the RTB's time and resources. At least if they chase a landlord- the landlord has an asset on which a lien can be applied- if they fail to comply with orders against them.

    Sure its unfair- but its a pragmatic admission that a tenant has nothing to loose- whereas a landlord does- so it makes far more sense to chase the money........... This means though- that tenants cop that there are no reprecussions to them playing the system- they'll never be made pay for it.


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    #11
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    Enforcing payment might be the issue even if getting a judgement is not.


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    #12
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Samuel T. Cogley wrote: »
    Enforcing payment might be the issue even if getting a judgement is not.

    The only person acceptable as a guarantor would have to be someone with assets capable of satisfying and who would not want the embarrassment of an unsatisfied judgement.


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    #13
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Samuel T. Cogley wrote: »
    Enforcing payment might be the issue even if getting a judgement is not.


    In youre in a situation where you want to rent to somebody who is potentially unreliable, but with a reliable guarantor, I'd suggest that you conclude the contract with the guarantor and let them sort out the finances with the actual tenant.


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    #14
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Deleted User wrote: »
    In youre in a situation where you want to rent to somebody who is potentially unreliable, but with a reliable guarantor, I'd suggest that you conclude the contract with the guarantor and let them sort out the finances with the actual tenant.

    That does not make sense. You can sue on the guarantee in the courts but you have to go to the RTB if the person is a tenant. Tenants are often unreliable financially since most don't own assets such as property and are often don't own other substantial assets either. Mant tenants don't have a financial cushion to pay a few months rent if they lose their job or suffer a serious uninsured illness. Good luck with trying to find a tenant who is a mark.


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    #15
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    4ensic15 wrote: »
    That does not make sense. You can sue on the guarantee in the courts but you have to go to the RTB if the person is a tenant. Tenants are often unreliable financially since most don't own assets such as property and are often don't own other substantial assets either. Mant tenants don't have a financial cushion to pay a few months rent if they lose their job or suffer a serious uninsured illness. Good luck with trying to find a tenant who is a mark.




    I'll say it simpler. You rent the house to the person offering the guarantee and consent to them putting the person they offer to guarantee for in the house.
    That way the rent gets paid and default is much less likely.

    In other words, rent to the parent, not the student.


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    #16
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Deleted User wrote: »
    I'll say it simpler. You rent the house to the person offering the guarantee and consent to them putting the person they offer to guarantee for in the house.
    That way the rent gets paid and default is much less likely.

    In other words, rent to the parent, not the student.

    That leads to other difficulties. It is not a residential lease if the person who rents the house is not going to live in it. That means the house might not be registrable with implications for tax relief. What is the parents PPR if they are renting one house and own another? If you go to the RTB they might refuse to deal with a claim on the basis that there is not a genuine tenancy. The courts might refuse to deal with a claim on the basis the landlord should have gone to the RTB.
    I know of plenty of guarantees but I am unaware of any type of letting by a parent on the basis described by you.

    If a parent is willing to guarantee the rent, how does it make it more likely they will pay it if they are a tenant?


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    #17
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    The myth of protection...


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    #18
    Clashmore
    Registered Users Posts: 207 ✭✭Clashmore


    4ensic15 wrote: »
    There is no need to go to the RTB to enforce a guarantee. All that is necessary is that there is a demand on a tenant and it is not paid. The RTB only deal with disputes between landlords and tenants, not landlords and third parties. Many landlords are demanding guarantees before letting so they can institute action against the guarantors in court immediately if there is a default. The District Court deals with claims up to 15K. I was once asked for a guarantee by a potential landlord on a residential premises. Just because a tenant can pay, doesn't mean they will pay. There are plenty of chancers gaming they system. There is no reason the District Court would refuse to give judgement if the requisite proofs are in order.

    Not true, the RTB does deal with third parties. I am a home owner and took a case against my neighbors and their landlord for failing to stop anti social behavior.


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    #19
    4ensic15
    Banned (with Prison Access) Posts: 4,691 ✭✭✭4ensic15


    Clashmore wrote: »
    Not true, the RTB does deal with third parties. I am a home owner and took a case against my neighbors and their landlord for failing to stop anti social behavior.

    The RTB deal with third parties with regard to some licencees and anti-social behaviour, but that is not relevant to the subject matter of this thread.


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