Does Being a Guarantor Affect Credit

D

David garcia

Member
A good friend of mine is renting a place, and the letting agent requires a guarantor. I’m happy to help out, and I’ve just received an email from the agent outlining the process. They’ve asked for a credit check, along with three months of payslips and proof of property ownership, which I can provide.

My concern is that I’m planning to renew my mortgage next year, and now I’m wondering could acting as a guarantor impact my credit file or affect my chances of getting approved for a new mortgage?

Would really appreciate any advice from someone who’s been through this or knows how it works.

Thanks in advance!
 
Yep, being a guarantor can affect your mortgage application not because it shows as debt, but because you're on the hook if your friend defaults. Lenders sometimes assess your financial exposure, not just your current obligations. I'd say speak to your mortgage advisor before committing.
 
I was a guarantor for my sister last year. The credit check didn't leave a hard mark on my file, but when i applied for a car loan, the lender asked about it. I had to explain that I wasn’t actually paying rent......it was her deal. Just a heads-up that some lenders do dig into that stuff.
 
Technically it doesn’t directly impact your credit unless your friend defaults, but emotionally… oof. I’ve seen friendships blow up over unpaid rent. Just be sure you’re okay covering their rent for months if it comes to that
 
Being a guarantor won’t necessarily lower your score or impact your mortgage unless the agreement gets reported to credit agencies, which varies by country and agency. But lenders do consider liabilities, even contingent ones. Best practice? Flag it during your mortgage pre-approval.
 
Nothing like tying your financial future to someone who forgets to reply to texts. seriously though, you're better off buying a crystal ball to see if they'll flake. Guarantor gigs are no joke.
 
I’m a mortgage broker. I’ve had clients denied because they were guarantors and the tenant missed payments so it showed up on their record. If your friend's responsible, it’s fine. But if they default and it hits your file? That can delay or destroy a mortgage deal.
 
You might want to read the guarantor agreement carefully. Some of them are joint and several, meaning you’re fully liable if anything goes wrong, not just a backup option. Risk level = high.
 
I did this for a mate in uni and he was sound...paid every month. But my mortgage advisor still clocked it as a liability during renewal. Didn’t kill my deal, but it was a convo I didn’t expect to have.
 
I’ve done it for my younger brother. The agency just did a soft check and confirmed income. No credit impact unless things go wrong. If you trust your mate, and you’re financially stable, it can be a beautiful act of kindness
 
Lenders look at potential liabilities. So even if you’re not paying anything now, they assess what you’d be on the hook for if things go sideways. Could affect borrowing limits. Not guaranteed, but possible.
 
Did this in 2020..credit score was fine, but when i applied for a BTL mortgage, the underwriter asked me to provide proof that my tenant-friend was paying on time. That was awkward. Keep records!
 
If you’re in the UK, some tenancy agreements now go through Experian’s Rental Exchange, which can reflect on your file if there’s any default. It’s not automatic, but it’s worth checking.
 
My concern would be less about your credit score and more about the lender's perception. If they think you're financially overstretched even if you're not that could affect their decision.
 
Honestly, I’ve done this twice with no issues at all. Just make sure you read the contract and know how to exit the guarantor role if you ever need to. Some let you pull out after 12 months.
 
Being a guarantor won’t show up on your credit file unless the debt becomes delinquent. But lenders may ask about it when assessing affordability. Be honest, but don’t panic.
 
Sweetheart, you sound lovely but don’t let guilt make your financial decisions. Your mortgage is your future. If your friend truly respects you, they’ll understand if you have to say no.
 
I declined to be a guarantor once and lost the friendship. But guess what? Two months later they were behind on rent. Dodged a bullet. Your friend might be great but life happens.
 
I think it’s admirable you’re considering this. Just make sure you’re looking at your full financial picture....credit, future plans, savings goals. Your kindness shouldn’t cost you long-term.
 
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