Institutional Residential Lease Guarantees Come to California
Institutional residential lease guarantees are new to the California apartment market and, consequently, are not well known or understood. They represent an attractive opportunity for landlords to reduce vacancies, drive renters to their properties, and eliminate all rent loss, at no cost to landlords or their management companies. Landlords accept the program, renters pay for it.
Developed over twelve years ago by New York based Insurent Agency Corporation, residential lease guarantees are the institutional “mommy and daddy” assisting a broad range of renters in qualifying for their chosen apartment. Young professionals moving to New York (or other major cities) typically do not have incomes sufficient to meet landlords’ credit criteria, generally requiring annual earnings of at least forty times the monthly rent. Alternatively, prospective tenants can use a co-signer (normally parents) with minimum annual incomes at least eighty times the monthly rent. With rents often very high in major cities like New York, many parents do not qualify. Other renters experiencing problems include (i) foreign executives relocating to the U.S. who have no U.S. credit history, (ii) the self-employed, (iii) non-employed U.S. and foreign individuals with significant assets, and (iv) both U.S. and international students.