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Rentals: Are tenants required to provide a physical guarantor? - La Nacion Propiedades
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www.lanacion.com.ar
April 04, 2025
The requirement for physical guarantors makes it difficult for potential tenants looking for a property—but is it really necessary?
With the guarantees presented, the owner is supported in case of breach of contract.
When deciding to rent a property , it's essential to have a guarantee that supports the fulfillment of the contract. Before the repeal of the rental law on December 29, 2023, the tenant had to offer two types of guarantee. These could be: a landlord's guarantee, a pay stub, or a surety bond. Now, as with all other important points, this is subject to free agreement between the parties .
Guarantees exist so that the landlord can ensure that the tenant will pay in a timely manner . These generally consist of another person, bank, insurance company, or company acting as guarantor or surety, who will take charge of the debt in the event of the tenant's breach of contract .
The traditional and most common approach is for a person to act as guarantor by offering a property as collateral . However, there are other forms of collateral, such as people offering their income as collateral , surety bonds , company-provided guarantees also called surety bonds , and bank guarantees .
These types have existed on the market for some time. However, it was the rental law passed in mid-2020 (27.551) that brought them into public knowledge , as it lists them as possible types to use.
The repeal of the rental law at the end of 2023 introduced changes to the requirements of rental contracts.Fabian Marelli
But is it mandatory to provide a physical guarantor? No, tenants are not required to provide a physical guarantor to sign a rental agreement. Instead, tenants can opt for private guarantees or surety bonds .
But it's also important to clarify that " you can sign a rental agreement without any guarantees ; it's completely valid, whether it's before or after Javier Milei's DNU; these aren't legal requirements, but rather practical ones ," explains Mariano Esper, a lawyer specializing in real estate matters. In any case, landlords require them to protect themselves against late payment .
It's important to clarify that, beyond the guarantor, the tenant is always responsible with his or her own assets to settle any debts he or she owes . The guarantor is the landlord's second party responsible in case the tenant doesn't pay. That is, for the landlord, there are always two parties responsible: the tenant and the guarantor.
www.buysellba.com
Source:
Alquileres: ¿es obligatorio que los inquilinos presenten un garante físico?
La exigencia de garantes físicos dificulta a los posibles inquilinos que buscan una propiedad; pero, ¿es realmente necesario?
www.lanacion.com.ar
April 04, 2025
The requirement for physical guarantors makes it difficult for potential tenants looking for a property—but is it really necessary?
With the guarantees presented, the owner is supported in case of breach of contract.
When deciding to rent a property , it's essential to have a guarantee that supports the fulfillment of the contract. Before the repeal of the rental law on December 29, 2023, the tenant had to offer two types of guarantee. These could be: a landlord's guarantee, a pay stub, or a surety bond. Now, as with all other important points, this is subject to free agreement between the parties .
Guarantees exist so that the landlord can ensure that the tenant will pay in a timely manner . These generally consist of another person, bank, insurance company, or company acting as guarantor or surety, who will take charge of the debt in the event of the tenant's breach of contract .
The traditional and most common approach is for a person to act as guarantor by offering a property as collateral . However, there are other forms of collateral, such as people offering their income as collateral , surety bonds , company-provided guarantees also called surety bonds , and bank guarantees .
These types have existed on the market for some time. However, it was the rental law passed in mid-2020 (27.551) that brought them into public knowledge , as it lists them as possible types to use.
The repeal of the rental law at the end of 2023 introduced changes to the requirements of rental contracts.Fabian Marelli
But is it mandatory to provide a physical guarantor? No, tenants are not required to provide a physical guarantor to sign a rental agreement. Instead, tenants can opt for private guarantees or surety bonds .
But it's also important to clarify that " you can sign a rental agreement without any guarantees ; it's completely valid, whether it's before or after Javier Milei's DNU; these aren't legal requirements, but rather practical ones ," explains Mariano Esper, a lawyer specializing in real estate matters. In any case, landlords require them to protect themselves against late payment .
What are the warranty options available on the market?
Although it's not a legal requirement, landlords still require collateral as a way to protect themselves against potential defaults . Among the options available on the market are:- Proprietary guarantee : In this case, a guarantor offers a property he or she owns as collateral , free of liens and all restrictions. This is the most traditional and widely used form of collateral, as it provides considerable financial solidity. This property, in practice, is real estate : it can be a house, an apartment, a lot, a field, among others.
- Paycheck collateral: A third party can act as guarantor or co-signer, offering their income as collateral , although in the event of seizure, only a percentage of it can be used. This often occurs when the tenant doesn't have a close relative who can act as guarantor with their property. In this sense, the financial backing to guarantee compliance with obligations is income.
- Bank guarantee or surety bond : When you don't have a guarantor who can offer property or a pay stub to back up the rental agreement, you can turn to insurers or banks that offer guarantees to cover the tenant's default in exchange for a prepayment . They work similarly to car insurance, making it easier to take legal action in the event of default. For the tenant, it's possible to access this type of insurance without having to rely on a support network of people with property. Furthermore, it's easier for the landlord to take action in the event of default.
It's important to clarify that, beyond the guarantor, the tenant is always responsible with his or her own assets to settle any debts he or she owes . The guarantor is the landlord's second party responsible in case the tenant doesn't pay. That is, for the landlord, there are always two parties responsible: the tenant and the guarantor.
www.buysellba.com
