What is a rent guarantor and why do you need one?

An increasing number of people in or coming to the UK have to provide a guarantor before they can rent privately. The English Housing Survey 2023-24 showed that 22% of private renters, equating to 984,000 households, were asked to provide a guarantor. Figures from Generation Rent put the figure even higher, with the campaign group’s latest research finding that 42% of renters who moved into their property in the past 12 months were asked to provide a guarantor (up from 26% five years ago).

Yet, worryingly, many renters still don’t know what a guarantor is, nor understand the differences that can underlie the term. When UK rental services provider Housing Hand surveyed 1,700 working professional and student renters, for its Understanding Renters in 2025 report, it found that 34% of renters didn’t know what a guarantor was at the point they were asked to provide one. This equates to one in three renters scrambling to find a guarantor at short notice when trying to secure their chosen property.

Fundamentally, a rent guarantor provides both tenant and landlord with peace of mind by taking legal responsibility for the rent if the tenant is unable to pay. It proves to landlords that the renter can meet their rent and bill requirements. This is especially useful for renters who haven’t had a chance to build up a favourable credit score yet, have a poor credit history or are moving to the UK from overseas. Landlords are particularly likely to ask these renters to provide a guarantor.

Guarantors can be personal (such as a family member) or professional, where a guarantor company provides the legal assurance as a service to the renter, helping them secure the property they want. Whoever serves as the renter’s guarantor – whether an individual or a professional service – takes legal responsibility for paying the rent if the tenant is unable to pay.

Renters who choose a professional guarantor service have various options available to them, with different companies provide vastly different levels of cover.

Graham Hayward, Managing Director at Housing Hand, points out the dangers of such a situation: “Not all guarantor services are equal. There’s huge variation in what they offer and in providers’ payout records. Renters who don’t know what a guarantor is, and who are racing against the clock to secure a home, are therefore at risk of choosing a service that doesn’t meet their needs. We can mitigate this risk by aiding a broader understanding of what guarantors are and why people need them, helping renters make informed decisions.”

Those considering using a rent guarantor service should ask these key questions when researching the options:

1. Will the rent guarantor service also provide support with finding accommodation? This can aid a more seamless home-finding experience.
2. What is the company’s approach to payouts? This is crucial to providing peace of mind. Housing Hand, for example, steps in and pays the rent in the event that the tenant cannot do so, then proactively supports the tenant with a payment plan to get back on track.
3. Does the service allow you to pay monthly? And if you choose to pay upfront instead, does it give you a discount for doing so? Housing Hand is leading the market in this area, with flexible payment options designed to meet varying needs.
4. Does the company provide proactive support and solid mediation capabilities designed to keep renters in their homes if they run into difficulties paying their rent? Graham Hayward points out the value of this: “Proactive support can help both renter and landlord move past any bumps in the road, resulting in a successful long-term rental arrangement that ultimately benefits both. This is a key element of Housing Hand’s approach to supporting renters.”
5. Is the rent guarantor service fully, or with a small excess, insurance backed, and without a commission benefit from the insurer? Unlike Housing Hand, some rent guarantor services receive commission for selling or using a particular insurer’s products and these should be disclosed.
6. Does the guarantor company pay commission to letting agents to be accepted? If so, it should be transparent about this (as it should with all aspects of the service). Letting agents should also be clear that renters have a choice of which guarantor service to use – the agent can’t insist on the use of a particular company.
7. Do you have to start paying for the guarantor service immediately or does it only take payment once your tenancy commences? Housing Hand, for example, charges a small upfront onboarding fee (£20) but doesn’t require any further payment until the tenancy begins.
8. Does the guarantor company offer any complimentary services? Housing Hand, for example, provides free 24/7 health and wellbeing support for all those who use the company as their guarantor.

Guarantor services exist to move financial risk away from landlords and from the individuals who would otherwise act as the renter’s guarantor – often parents, extended family or friends. With the cost-of-living crisis continuing to put pressure on families, demand for professional rent guarantor services has risen significantly in recent years.

With this in mind, Housing Hand is urging people to learn more about guarantors well before the point they are asked for one, enabling renters to make informed choices when it comes to finding a reputable, reliable and supportive service. Housing Hand itself provides an insurance backed guarantor that comes with free 24/7 health and wellbeing support and a free House Finder service providing personalised property matching.