When it comes to leasing an apartment, why should a renter leverage a co-signer? What’s the benefit? What does the process look like? What is a co-signer, even? Don’t worry — we’re here to fill you in on the who, what, when, where, and why of co-signers (because knowledge is power, duh).
The rundown on co-signers
Sometimes when you’re applying for an apartment, the leasing agent on-site may suggest or require that you have a co-signer on your lease. Don’t be offended — most apartment properties aim to offer as many options as possible for prospective renters to get approved. Having a co-signer on your lease gives you the backing required to get that dream apartment, and gives the property reassurance that rent will be paid each month. A co-signer doesn’t have to live in the apartment, but their name will be on the lease.
We’re going to let you finish [reading], but…
We needed to address three frequently asked questions our agents get when it comes to co-signers: Does having one change the amount of rent? Nope, not at all. Does having a co-signer mean I’ll get the apartment for sure? Not necessarily, but it increases your chances of getting approved which will ultimately get you the apartment. Do they have to be a parent or guardian? Not unless you’re under the age of 18!
Okay, carry on…
Who might need a co-signer, and why?
Properties typically ask for co-signers regarding leaseholders with little to no rental history, bad credit, or whose monthly income isn’t at least three times the monthly rent. Where our agents see the need for co-signers are typically for recent grads, first-time renters, and people getting job stuff nailed down in the midst of relocating. If you’re renting with a roommate and one or both of you fall under one of the three categories listed at the beginning of this section, you’ll only need one co-signer for the lease.
What does having a co-signer on the lease look like?
First off, a co-signer will be asked to complete the same application and administration requirements as the leaseholder and is usually required to make five times the monthly rent. A co-signer is essentially insurance that anything requiring payment, deposit, or damage gets covered if the leaseholder(s) can’t cover it. That’s why properties like to see that their income matches the weight of that agreement and why they’re asked to make five times the monthly rent, instead of three like the leaseholder.
As we mentioned above, a co-signer is liable for the monetary assistance or repercussion of all leaseholders in the unit, which also means that when it comes to getting approved, they benefit ALL applicants, as well! This especially comes in handy for all those first-time renters out there who are building their portfolio of rental history and good credit.
What if I want to take my co-signer off my lease?
Okay, so, say your financial documents come to prove over time that you no longer need that “reassurance” on your lease, can you remove your co-signer? A leaseholder cannot take a co-signer off a current lease agreement. However, when it comes time for renewal, you can re-submit an application with your current financial documents to show your property that a co-signer won’t be necessary for your next lease term.
Deciding to co-sign on a lease
We are by no means a replacement for legal advice when it comes to taking on financial responsibility and obligations regarding apartments. However, we do want to touch on a few key things to keep in mind should you choose to co-sign on a lease. A co-signer is responsible for ALL leaseholders in that apartment, meaningyou assume equal responsibility of an apartment lease when you sign on. If rent cannot be paid, that means you’ll be at default and the repercussions can affect your credit.
That doesn’t mean those things will transpire, but you should definitely consider all the options when co-signing on a lease. Think about things like:
- How well you know the tenant(s)
- Financial track-record of the person/people you’re co-signing for
- If you are able/willing to make rent payments if the tenant(s) cannot
- The relationship you have with the tenant(s)
Leveraging a co-signer doesn’t work for every lease situation, and we in no way suggest that renters leverage a co-signer to seek out an apartment that exceeds what is doable financially. When used appropriately, though, a co-signer could be the perfect balance of stability a property needs in order to get you approved and moved into your dream place!