BuySellBA
Administrator
Private guarantees for rentals: how much they cost and what is the process for processing them? - Infobae
Source:
www.infobae.com
November 06, 2024
With the repeal of the Rental Law, supply increased and prices fell. It is an alternative for those who do not have a family member or friend to act as guarantor. In addition, it speeds up transactions.
By Jose Luis Cieri
They usually leave within 24 hours, the private guarantee is a practical solution that covers the payment of rent and other contractual obligations when there is no owner guarantee (Illustrative Image Infobae)
In a context of active demand for rentals and with a supply that has grown by more than 170% in the city of Buenos Aires since the repeal of the Rental Law, tenants still face significant obstacles in securing housing.
The requirement of physical guarantors makes it difficult to access rentals, especially for those who do not have family or friends to assume this responsibility. Private guarantees emerge as an accessible alternative to meet these requirements without depending on third parties.
This option not only reduces stress for tenants, but also provides peace of mind for landlords, who ensure payment even in the event of default.
To obtain this guarantee, tenants must demonstrate their ability to pay through financial and employment requirements, such as proof of income or credit reports, which vary depending on their employment profile and seek to minimize risks.
Diego Rajtman , marketing manager of GarantiaYa, explained to Infobae that private guarantees offer several benefits to both owners and tenants when compared to traditional guarantees. “Our guarantee assures the owner of the flow of income, immediately covering the rent, expenses and services in case of non-compliance by the tenant. In addition, the process is quick and simple, since we take care of all the costs.”
Furthermore, thanks to the digitalisation of processes, the analysis and approval of a private guarantee is generally carried out within 24 hours, providing tenants with quick and hassle-free access.
Among the requirements, the tenant must demonstrate stable and sufficient income to cover the rental value and other associated expenses, such as utilities.
Oscar Lema , president of Finaer, explained how coverage works and the calculation of costs of private guarantees for tenants. “If, for example, a monthly rent is $250,000 plus $50,000 in expenses, the total monthly amount to be covered amounts to 300,000 pesos. For a 24-month contract, the total amount would be $7,200,000 and, by applying 7.5%, the cost of the guarantee would result in $540,000,” Lema details.
Lema also highlighted the protection that these guarantees provide to owners: “We offer the security of payment not only for rent, but also for expenses, taxes and services such as electricity and gas, even if the tenant defaults on payment. Everything is covered upon simple request, without the need for formal notifications or legal action. And, if necessary, we assume the costs of legal action until the property is restituted.”
This tool ensures the payment of rents and reduces risks, offering quick payments in case of non-compliance, without the need for long judicial processes (Illustrative Image Infobae)
The required documentation depends on the applicant's employment status: employees, self-employed workers or registered responsible persons must present certificates that guarantee their ability to pay, adjusted to their income level. The process is completely digital, which facilitates accessibility to tenants in any area of the country.
Additionally, by having a private guarantee, tenants strengthen their credit profile, which can help them secure future rentals.
For landlords, private guarantees ensure payment in the event of a tenant's default. This backing avoids cumbersome legal proceedings, since the guarantee companies assume the costs and procedures until the property is recovered.
According to Rajtman, these benefits have led to “almost the entire real estate market accepting this system”, which demonstrates the growing confidence in this alternative.
These guarantees simplify the rental process by avoiding complex procedures and physical guarantors, in addition to improving the qualification for future contracts and preventing undue charges (Illustrative Image Infobae)
For tenants, private guarantees allow them to rent with their own resources, without depending on family or friends as guarantors. In addition, the renewal of these guarantees is automatic, providing support for future contracts.
“Until 2012, only private guarantors existed. Today, various companies have innovated with systems that are widely accepted in almost the entire country, facilitating access to housing in any location. These private guarantees are already more popular than the traditional model of physical guarantors,” concluded Lema.
www.buysellba.com
Source:
Garantías privadas en alquileres: cuánto cuestan y cómo es el proceso para tramitarlas
Con la derogación de la Ley de Alquileres, aumentó la oferta y los precios se aplacaron. Es una alternativa para quien no cuenta con un familiar o amigo que le salga de garante. Además, agiliza las transacciones
www.infobae.com
November 06, 2024
With the repeal of the Rental Law, supply increased and prices fell. It is an alternative for those who do not have a family member or friend to act as guarantor. In addition, it speeds up transactions.
By Jose Luis Cieri
They usually leave within 24 hours, the private guarantee is a practical solution that covers the payment of rent and other contractual obligations when there is no owner guarantee (Illustrative Image Infobae)
In a context of active demand for rentals and with a supply that has grown by more than 170% in the city of Buenos Aires since the repeal of the Rental Law, tenants still face significant obstacles in securing housing.
The requirement of physical guarantors makes it difficult to access rentals, especially for those who do not have family or friends to assume this responsibility. Private guarantees emerge as an accessible alternative to meet these requirements without depending on third parties.
This option not only reduces stress for tenants, but also provides peace of mind for landlords, who ensure payment even in the event of default.
How private companies work
Private guarantees offer financial support without the need for physical guarantors. Instead of relying on family or friends, these companies assume the responsibility and ensure the landlord pays the agreed rent and services.To obtain this guarantee, tenants must demonstrate their ability to pay through financial and employment requirements, such as proof of income or credit reports, which vary depending on their employment profile and seek to minimize risks.
Diego Rajtman , marketing manager of GarantiaYa, explained to Infobae that private guarantees offer several benefits to both owners and tenants when compared to traditional guarantees. “Our guarantee assures the owner of the flow of income, immediately covering the rent, expenses and services in case of non-compliance by the tenant. In addition, the process is quick and simple, since we take care of all the costs.”
Furthermore, thanks to the digitalisation of processes, the analysis and approval of a private guarantee is generally carried out within 24 hours, providing tenants with quick and hassle-free access.
Costs and requirements for the tenant
The cost of a private guarantee is usually a percentage of the total amount of the rental contract, and can be paid in installments or through financing agreements that these companies offer in conjunction with local banks. “As a reference, the price of a guarantee for a rent of $500,000 per month is around $700,000, a one-time payment and is paid at the beginning of the rental contract,” Rajtman added.Among the requirements, the tenant must demonstrate stable and sufficient income to cover the rental value and other associated expenses, such as utilities.
Oscar Lema , president of Finaer, explained how coverage works and the calculation of costs of private guarantees for tenants. “If, for example, a monthly rent is $250,000 plus $50,000 in expenses, the total monthly amount to be covered amounts to 300,000 pesos. For a 24-month contract, the total amount would be $7,200,000 and, by applying 7.5%, the cost of the guarantee would result in $540,000,” Lema details.
Lema also highlighted the protection that these guarantees provide to owners: “We offer the security of payment not only for rent, but also for expenses, taxes and services such as electricity and gas, even if the tenant defaults on payment. Everything is covered upon simple request, without the need for formal notifications or legal action. And, if necessary, we assume the costs of legal action until the property is restituted.”
This tool ensures the payment of rents and reduces risks, offering quick payments in case of non-compliance, without the need for long judicial processes (Illustrative Image Infobae)
The required documentation depends on the applicant's employment status: employees, self-employed workers or registered responsible persons must present certificates that guarantee their ability to pay, adjusted to their income level. The process is completely digital, which facilitates accessibility to tenants in any area of the country.
Benefits for both parties
For tenants, private guarantees eliminate the need to hire guarantors, simplifying the rental process and eliminating complicated paperwork. This is especially beneficial for those who do not have family or friends who can support them.Additionally, by having a private guarantee, tenants strengthen their credit profile, which can help them secure future rentals.
For landlords, private guarantees ensure payment in the event of a tenant's default. This backing avoids cumbersome legal proceedings, since the guarantee companies assume the costs and procedures until the property is recovered.
According to Rajtman, these benefits have led to “almost the entire real estate market accepting this system”, which demonstrates the growing confidence in this alternative.
Impact on the real estate market
Since the Rental Law was repealed and inflation began to decline, prices have also stopped starting from values as high as at the beginning of the year.
These guarantees simplify the rental process by avoiding complex procedures and physical guarantors, in addition to improving the qualification for future contracts and preventing undue charges (Illustrative Image Infobae)
For tenants, private guarantees allow them to rent with their own resources, without depending on family or friends as guarantors. In addition, the renewal of these guarantees is automatic, providing support for future contracts.
“Until 2012, only private guarantors existed. Today, various companies have innovated with systems that are widely accepted in almost the entire country, facilitating access to housing in any location. These private guarantees are already more popular than the traditional model of physical guarantors,” concluded Lema.
www.buysellba.com
