Rent guarantee insurance, also known as rent guarantee insurance, is an insurance product designed for landlords who want to be assured that their rental income will not be interrupted. With this type of insurance, the insurer will take over the rental income in the event of non-payment by the tenant. A guarantor in a rental contract is simply someone who guarantees your rental obligations. It can be a relative, a friend or a service.
A guarantor rental service is like a nice rich uncle who helps you rent a property for which you are not eligible on your own. Guarantor services can act as your co-signer, help with your deposit or pay your rent if you are unable to do so. Of course, they do not offer these services for free. There are fees and obligations to pay, but if you want to live in an area with high demand and high cost of living, it may be the only way to secure a rental contract.
Rent guarantee insurance acts as a safety net in case a tenant stops paying rent. Steady's rent guarantee insurance will cover between six weeks and six months of lost rent per year, allowing landlords to initiate eviction proceedings (if necessary) without giving up months of rental income. Rent guarantee insurance is essentially an insurance product that can be purchased from an insurance broker who specialises in leases. There are many reasons for a tenant to stop paying rent.
Job losses, medical emergencies and other circumstances can lead to non-payment of rent, even when the tenant has been reliable. As part of your rental application, the service will run a credit check, and if you miss or default on payments, your credit will be negatively affected. Landlords simply select the rental guarantee insurance they need, choosing a coverage period of between six weeks and six months per year. If they act as co-signers, they will take over your rental payments in the event that you fail to make them and cover the cost of damages when you move out.
With the support of a dedicated team of industry professionals, over the past 11 years it has built a digital marketplace offering low-cost services that enable landlords and tenants to rent and let properties with ease. The cost of the cover can be absorbed into the monthly rent paid by the tenant, ensuring that the landlord does not have to foot the bill. Rent guarantee services may be offered by your property manager or you may have to obtain them on your own. Rent guarantee insurance can be expensive, costing between 5% and 7% of the annual rent payments linked to a policy.
If you break your lease and owe your landlord money, either for past or future rent, rent guarantee will make sure your landlord is covered. Tenants stop paying rent for many reasons: loss of employment, cash flow problems, marital problems, military deployment, etc. When a landlord relies on rental income, either to pay the mortgage or to finance any other expenses, a tenant's non-payment can have serious consequences.