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  1. #1
    Peter Devereaux is offline Recidivist Moperer
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    Default Co-signing a lease

    Interesting situation. Two young ladies want to lease a two bedroom apartment. The landlord wants one of the young ladies to have a co-signor on the lease, but not the other young lady. The young lady from whom the landlord wants a co-signor just graduated from college and just got an entry-level office job-has no rental history, but does have a credit history. The other young lady graduated a few years ago and has been in her current job for several months-she has a rental history and a credit history. The incomes of both ladies easily pays for the lease, though the income of eithger one would be hard to cpver the lease.

    Whaddya think? Why doesn't the landlord want co-signors for both young ladies? What risk is the co-signor taking if the non-cosigned young lady leaves or stops paying rent?

    Thanks!

  2. #2
    theWatusi's Avatar
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    Quote Originally Posted by Peter Devereaux View Post
    Why doesn't the landlord want co-signors for both young ladies?
    Probably because the one has good income history but the other one doesn't.

    What risk is the co-signor taking if the non-cosigned young lady leaves or stops paying rent?
    The co-signor would be held liable for rents due/damages done to property/etc etc. I'd be hesitant to cosign in a situation like that.

  3. #3
    Sycamore is offline Sure Shot
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    I would never cosign a lease where there were two parties to the lease. Too many variables for things to get mesed up.

  4. #4
    ACG
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    This is the exact situation I had with a friend when we leased our first apartment. I both had no rental history and we did have credit history... just my history was good, her's was bad.

    Basically, the landlord doesn't care what agreement the girls come to between themselves (50/50, 40/60. etc), if the rent is paid in full each month, the landlord can take legal action against both. The landlord can evict anyone still living there (either one or both) if the rent isn't paid in full & can sue both in court to get the back rent.

    Signing a lease with someone is always a crap shoot & even if they have good credit you can get screwed. A co-signor is guaranteeing that the lease will be paid by the lessors or will cover any unpaid rent, so I am pretty sure they'd hit you up first for the unpaid money to avoid court, but you could be dragged into it too... if it goes into collections, your credit history can be affected too.

    Unless the landlord is willing to sign a lease saying lessor A is only contracted for $X and lessor B for $Y, they both owe the rent in full and if it is not they are both equally responsible for the unpaid amount (even if A paid her half).

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    Quote Originally Posted by Sycamore View Post
    I would never cosign a lease where there were two parties to the lease. Too many variables for things to get mesed up.
    I would never cosign anything for anyone for the same reason. Don't you people watch Judge Judy?

  6. #6
    ACG
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    Quote Originally Posted by PhillyKev View Post
    I would never cosign anything for anyone for the same reason. Don't you people watch Judge Judy?
    And never ever ever put a cell phone in your name for someone else.

  7. #7
    ACG
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    seriously, co-signor or not, entering into a lease another person(s) is always a gamble. I have rented & worked for a management co so I have seen it from both sides. Personally for myself I have never entered into a lease where I could not pay the whole rent on my own if I needed to. I could take the other person on the lease with me to court to collect the portion of the rent they own per our agreement if I needed to, but in the mean time my credit would not be in jeopardy and I wouldn't have to worry about eviction if they went MIA on me.
    If I am moving into a place with others and I can not afford the whole rent on my own, I will only enter into a sublease with the person leasing the place for only my portion of the rent. If they did go MIA, the worse I would have to deal with is moving out, but I would not be financial responsible for anything.

  8. #8
    doodle is offline Member
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    Quote Originally Posted by Peter Devereaux View Post
    Whaddya think? Why doesn't the landlord want co-signors for both young ladies? What risk is the co-signor taking if the non-cosigned young lady leaves or stops paying rent?

    Thanks!
    As to why the landlord doesn't need a co-signor for the other lady, most likely for some reason he considers the first lady a higher risk, but who knows?

    The risk that the co-signor is taking on is all the risk, the same risk as anyone on the lease. Actually the risk is greater because of lack of control, and also the landlord will most likely go after the co-signor first.

    Think about it: if the other lady takes off, do you think the remaining young lady would just be allowed to live in the whole apartment while only paying half of the landlord's rent?

  9. #9
    toxigal is offline Senior Member
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    Quote Originally Posted by Peter Devereaux View Post
    Interesting situation. Two young ladies want to lease a two bedroom apartment. The landlord wants one of the young ladies to have a co-signor on the lease, but not the other young lady. The young lady from whom the landlord wants a co-signor just graduated from college and just got an entry-level office job-has no rental history, but does have a credit history. The other young lady graduated a few years ago and has been in her current job for several months-she has a rental history and a credit history. The incomes of both ladies easily pays for the lease, though the income of eithger one would be hard to cpver the lease.

    Whaddya think? Why doesn't the landlord want co-signors for both young ladies? What risk is the co-signor taking if the non-cosigned young lady leaves or stops paying rent?

    Thanks!
    is it one lease or two? will each renter have their own lease? if not, then i would assume the co-signer would techincally be co-signing for both ladies, not just one.

  10. #10
    Peter Devereaux is offline Recidivist Moperer
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    Thank you for all of your replies. I did not like the sound of it, for the same reasons, and now I have folks to back me up.

  11. #11
    bobmartins69 is offline Junior Member
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    This an usual situation. But if the girl who is working on entry-level office job could look for a leasing guarantee firm to be a guarantor between herself & the landlord. This would work fine.

  12. #12
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    If you co-sign a contract, you become responsible for ALL the contingencies and requirements in the contract if the other person decides to skiddadle out of the transaction.


    Apartment complexes will require all those living in a unit to be co-signed. Many leases with apartment complexes will also forbid you from sub-letting your apartment as well. If you decide to co-sign on a lease and split the rent with someone, FULLY EXPECT THAT YOU MAY BE LIABLE FOR THE ENTIRE RENT STARTING TOMORROW.


    If you can't handle the entire rent on the apartment on your own, right now, today... then it is irresponsible of you to co-sign a rental agreement.

  13. #13
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    Quote Originally Posted by Peter Devereaux View Post
    Interesting situation. Two young ladies want to lease a two bedroom apartment. The landlord wants one of the young ladies to have a co-signor on the lease, but not the other young lady. The young lady from whom the landlord wants a co-signor just graduated from college and just got an entry-level office job-has no rental history, but does have a credit history. The other young lady graduated a few years ago and has been in her current job for several months-she has a rental history and a credit history. The incomes of both ladies easily pays for the lease, though the income of eithger one would be hard to cpver the lease.

    Whaddya think? Why doesn't the landlord want co-signors for both young ladies? What risk is the co-signor taking if the non-cosigned young lady leaves or stops paying rent?

    Thanks!

    Peter:

    It's time to find a backup apartment to see if you can get a different situation that only requires both ladies to be on the lease without co-signers.



    I am sure the landlord asked the applicant for a co-signer to put her mommy or daddy down as a co-signer to get the apartment. If something happens with her job, they can sue mommy or daddy and then send the lease to a collections agency to harass mommy or daddy indefinitely until the lease is paid off, no doubt with exorbitant and mysterious fees attached.


    If I was the parent of a child and my child asked me to do this, I would refuse. I am not going to jeopardize my own credit and become responsible for a 5-figure lease [it's a 1year, right?] if I am not living there.

    Let the tenants of the apartment co-sign against each other, or walk.

  14. #14
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    loveisnoise is offline Senior Member
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    It makes perfect sense. If a young lady is just starting out, has a new job, and has 'good credit'-it doesn't mean that they have established credit. Anyone with less than a 2 year history or no previous references will automatically be flagged. Get mom or dad to cosign, live there for a year, and now you've got a reference for life.

  15. #15
    ArcticSplash's Avatar
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    Quote Originally Posted by loveisnoise View Post
    It makes perfect sense. If a young lady is just starting out, has a new job, and has 'good credit'-it doesn't mean that they have established credit. Anyone with less than a 2 year history or no previous references will automatically be flagged. Get mom or dad to cosign, live there for a year, and now you've got a reference for life.
    If you do decide to co-sign for anyone, even if it's a familial relationship, just remember you're on the hook for the entire amount of the unpaid obligation. Do not take this lightly. You are actually promising to pay whatever obligation it is you are co-singing for in case the applicant defaults on the obligation.

    Landlords do have the capacity to ask for the entire remaining rent up til the stated end of the lease contract, then after a new tenant is secured and established, whatever the unpaid portion of the rent was between the default and when the new tenant began enjoying the property. If you do not pay them off, they will refer you to collections, and your credit report will be trashed.

    If the creditor is particularly nasty, they can also secure a judgment against you in small claims court and then also obtain a wage garnishment or lien to recover the unsecured portion of whatever it was they claimed you owe. They may also sell your obligation to a 3rd party who will then proceed with the same tactics. This can go on over a decade after the default.

    With a fresh collection showing on your credit report, you can be subject to adverse action by your current creditors, especially with any revolving credit line you may have (HELOC, credit cards, personal lines, etc).


    Employers that do credit checks primarily look for fresh delinquencies and collections accounts showing on your credit reports [they are forbidden by law from considering an active or previous bankruptcy, however].


    Decide carefully.

  16. #16
    LUCas is offline Senior Member
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    Also each renter is severally liable for the rent. In other words, if girl with no co-signator bails, girl with co-signator, and by extension, the co-signators, are liable for ALL the rent. If you co-sign for someone with a roommate, you are, in essence, co-signtor for both.

  17. #17
    loveisnoise's Avatar
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    In other news, I heard the grass is green and the sky is blue.

    Of course this stuff can happen. And these girls could live separately in smaller apartments and lesser neighbors. Everything has risks-last I looked, 50% of marriages fail, and that's one big mess when that 'roommate' leaves.
    Quote Originally Posted by ArcticSplash View Post
    If you do decide to co-sign for anyone, even if it's a familial relationship, just remember you're on the hook for the entire amount of the unpaid obligation. Do not take this lightly. You are actually promising to pay whatever obligation it is you are co-singing for in case the applicant defaults on the obligation.

    Landlords do have the capacity to ask for the entire remaining rent up til the stated end of the lease contract, then after a new tenant is secured and established, whatever the unpaid portion of the rent was between the default and when the new tenant began enjoying the property. If you do not pay them off, they will refer you to collections, and your credit report will be trashed.

    If the creditor is particularly nasty, they can also secure a judgment against you in small claims court and then also obtain a wage garnishment or lien to recover the unsecured portion of whatever it was they claimed you owe. They may also sell your obligation to a 3rd party who will then proceed with the same tactics. This can go on over a decade after the default.

    With a fresh collection showing on your credit report, you can be subject to adverse action by your current creditors, especially with any revolving credit line you may have (HELOC, credit cards, personal lines, etc).


    Employers that do credit checks primarily look for fresh delinquencies and collections accounts showing on your credit reports [they are forbidden by law from considering an active or previous bankruptcy, however].


    Decide carefully.

 

 

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