Mitigating Risk in a Post-RRA Environment
Guest Blog - RentGuarantor Limited
The abolition of rent in advance is arguably one of the most challenging aspects of the Renters’ Rights Act for lettings professionals. Money in the bank provided clarity and confidence regardless of whether a tenant’s ability to pay became a problem later, and this surety enabled agents to work efficiently and smoothly, keeping business moving at pace. How can we as an industry replicate this certainty of income for our landlord clients as we move forwards, while remaining compliant with the new rules?
The role of the Rent Guarantor
An empty property means no rent payment but at the same time, agents cannot afford to compromise on risk. Striking the right balance becomes ever harder when applicants fall outside standard referencing criteria, even when they are otherwise suitable.
A professional rent guarantor service does exactly what it says on the tin. Instead of chasing alternative documentation or applying case-by-case exceptions, a guarantor can offer a clear route forward, providing reassurance to the landlord while allowing the tenancy to proceed without unnecessary delay. This approach reduces decision time and helps agents move from offer agreed to contract signed more efficiently.
It protects everyone involved in a tenancy against unforeseen events, such as a cut in work hours or a surprise bill. A service provider like RentGuarantor steps in, makes the payment on behalf of the tenant and works constructively with them to agree a payment plan.
A professional rent guarantor cannot eliminate all risk (and really, nothing can), but the service can reduce exposure to income loss.
Unlocking New Tenancies
A professional rent guarantor doesn’t only unlock tenancies for those looking for somewhere to live, but for landlords too. It means that agents can expand the pool of potential tenants to include people who may have previously been overlooked, such as international students without a personal UK guarantor, freelance workers or retirees.
Expecting the Unexpected
A rent guarantor provides a practical way to moderate the risk of income disruption when unexpected events occur. Even comprehensive tenant referencing only provides a snapshot of past behaviour. An uncertain economy, rising living costs or changes to personal circumstances can all affect tenants’ ability to pay while landlords remain responsible for mortgage payments and regulatory compliance throughout. A professional rent guarantor ensures that rental payments continue, reducing the impact of arrears and financial strain, and keeping business going.
Mitigation not Litigation
A professional rent guarantor also provides landlords with practical support when tenants fall behind on rent. RentGuarantor supports open communication with tenants and protection of the landlord’s position without immediate financial pressure affecting decisions. If necessary, RentGuarantor will even handle court applications and eviction costs in the case of arrears, ensuring the process is carried out efficiently and promptly.
We’ve worked with more than 1900 lettings agents since RentGuarantor was established in 2018, and have supported thousands of tenants in that time. Our partnerships with lettings professionals have provided the financial reassurance that landlords need. Uncertainty can often feel like the only certainty in the current climate; whether your client is investing for the long-term or supplementing their month-to-month income now, a reliable rental stream is fundamental to building trust and ensuring success.