Being asked to act as a guarantor on a UK tenancy is a significant legal commitment — yet most guarantors sign without fully understanding what they're agreeing to. A guarantor clause can make you personally liable for the full rent, property damage, and even the tenant's legal costs for the entire tenancy. The risks are particularly acute for guarantors on joint tenancies, where you could be liable for the entire rent of a shared property, not just one tenant's share. Before you sign, you need to understand exactly what you're guaranteeing.
What is a Guarantor Clause?
A guarantor clause in a tenancy agreement (or a separate guarantor deed) is a legally binding promise by a third party to cover the tenant's obligations if the tenant fails to meet them. This typically includes rent arrears, property damage beyond normal wear and tear, and any other breaches of the tenancy agreement. The guarantor's liability is usually co-extensive with the tenant's — meaning anything the tenant owes, the guarantor owes if the tenant doesn't pay. It creates a direct contractual relationship between the guarantor and the landlord.
Red flags to watch for
Some guarantor clauses continue into periodic tenancies and renewals indefinitely. If the tenancy converts to a rolling monthly tenancy, you could remain liable for years beyond what you expected.
If you're guaranteeing one person in a shared house, but the guarantee covers the 'joint tenancy,' you could be liable for the full rent if all tenants default — not just one person's share.
An uncapped guarantee means your exposure is unlimited. Rent arrears, dilapidations, legal costs, and interest can add up to tens of thousands of pounds.
If the landlord and tenant agree to increase the rent or change the terms, a guarantor whose liability survives variations is bound by terms they never agreed to.
If the landlord doesn't have to tell you the tenant has missed rent, arrears can accumulate for months before you find out — and you're liable for the full amount.
Your legal rights
Under English law, a guarantee must be in writing and signed to be enforceable (Statute of Frauds 1677, section 4). If you're a consumer, the Consumer Rights Act 2015 may apply to the guarantee terms — unfair terms in a consumer contract are not binding. The key case of Holme v Brunskill (1878) established that a material variation of the underlying contract without the guarantor's consent discharges the guarantee. However, modern guarantee clauses often include waivers of this protection, which may themselves be challengeable as unfair terms. The Unfair Contract Terms Act 1977 does not apply to guarantees, but the CRA 2015 does if the guarantor is acting as a consumer. A guarantor who pays the landlord can pursue the tenant for recovery under the right of subrogation.
Questions to ask before you sign
- 1Does the guarantee continue if the tenancy becomes periodic or is renewed?
- 2Am I guaranteeing just one tenant's share, or the entire joint tenancy?
- 3Is there a cap on my total liability under the guarantee?
- 4Will I be notified if the tenant falls into arrears?
- 5Does my guarantee survive if the landlord and tenant change the terms of the tenancy?
- 6Can I terminate the guarantee by giving notice?
Disclaimer: This guide is for educational purposes only and does not constitute legal advice. Contract law varies by jurisdiction and individual circumstances. Always consult a qualified legal professional before making decisions based on this information.