Beware when co-signing lease

College-age renters face curious contracts

By Inman News Feed
Add Comment Add Comment | Comments: 2 | Posted Sep. 17, 2009

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College-age renters face curious contracts

Tom Kelly
Inman News

The oven didn't work, so the barbecue was constantly fired up in the tiny backyard. The sofa had no casters and was supported by old paperbacks the owners hadn't cracked in months. Shelves were composed of red bricks and any available wood planks. Mattresses and box springs neither matched nor were afforded the luxury of a frame.

There were always dirty rugby shoes outside the front door and rarely anything more than milk, bologna and beer in the refrigerator.

Thirty-eight years ago, our senior year of college, it was home -- for $200 a month, split four ways. The stucco duplex, just a nine-iron chip from a regional mall, boasted two bedrooms, one bath, a tiny den, fireplace, garage, and kitchen with eating space and counter.

And, to top things off, the neighbors were our best friends. That proved to be worth more than the monthly rent in memorable times, quickly gathered carpools, term-paper consults and typewriter sharing.

What was not shared was the rental agreement with our parents. My folks had no idea of the terms of our lease, except for the fact that I asked them for $100 as my portion of both the first month's rent and the cleaning deposit ($200).

Not so today. In many cases, parents are required to co-sign lease agreements and act as guarantors to support their children who want to rent a home, apartment or condominium near a college or university. In the past several years, three of our children came to us with rental contracts that were creative, curious and demanding. Our employment history, current and past addresses, Social Security numbers and credit background were critical before any of the kids were approved for temporary housing.

I vividly remember editing contracts, proposing compromises and then questioning landlords and rental agencies about their seemingly mandatory requirements and outlandish rates for what often appeared to be substandard housing or a small cubbyhole.

In a tight rental market, any changes can be a deal-killer. Other willing renters are often standing in line, or at least the landlord presents it that way.

("If you don't want to sign it, Mr. Kelly, I've got plenty of people who will.")

What is more discomforting is the domestic anxiety created by the urgency of the contract. Typically, a son or daughter has scoured the immediate area and secured a terrific location, but time is absolutely of the essence if the child is to take occupancy.

("Dad, everybody's parents have signed. Why are you being so difficult? Even Billy's mom signed and she owns a bunch of her own rentals.")

It is back-to-school time and college-age kids are looking to the folks for rental assistance while landlords are looking to parents to ensure the monthly lease payments are actually made. But when are landlords actually being unreasonable? Are all of their conditions and expectations actually enforceable?

In an apartment complex near the University of Washington, a landlord required parents to sign a lease and co-signer addendum in order for the children to be rental candidates. While the wording and contents of both documents are important, the intent and enforceability are confusing. The co-signer addendum was the more daunting. The guarantor (parent) was asked not only to guarantee the lease but also to subscribe to additional terms and conditions, including the following:

  • "Owner shall have the right to exercise the following powers and rights in the owner's sole discretion: owner may change, alter, cancel, renew, extend, decrease or increase the obligations of the tenant to owner."

"If that language was in the lease, I don't think the terms would be enforceable," said Rob Crichton, partner in the Seattle law firm of Keller Rohrback LLP. "There is a rule where you cannot unilaterally increase the risk.

"I think the intent here is for signature by the guarantor. The parent is empowering the tenant to extend the obligation. For example, if the landlord and tenant agree to extend the term of the lease, the landlord does not have to go back to the guarantor (parent) for a signature."

Make sure you understand all rental contracts before signing them. Ask landlords to explain the fine print and the reason for specific paragraphs. Be particularly aware of the contents of the actual lease document and your obligations to perform. Usually there is time to straighten out most matters, even with a kid screaming in your ear.

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1. Anonymous said... on Apr 12, 2010 at 09:20PM

“I wish you had written more about your experience and advice because this is exactly what I am facing! I can't find any resources for what is normal and customary for a co-sign agreement! It is for the state of Washington too.”

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2. Anonymous said... on May 2, 2011 at 10:14PM

“A much better contract is a Parental Guarantee Agreement. This is what the University of Calif. Santa Cruz recommends. It is available on their website. It is sickening how many landlords try to bully young adults into signing contracts with totally unreasonable demands. The latest was when the landlord refused to give a copy of the lease to the renters ahead of time and demanded that they sign it as is with only 30min to read it or lose the rental unit! More renters should refuse this type of risky & pushy treatment so that all renters are treated with more consideration.”

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