How to Screen Co-Signers and Guarantors: The Landlord's Complete Guide

By PropsManager Team · Tenant Screening · Aug 28, 2025

I'll never forget the time I approved a tenant with a co-signer who "made great money." The tenant stopped paying after three months. When I turned to the co-signer for the $1,450 monthly rent, I discovered she'd just lost her job and had $38,000 in credit card debt. That lesson cost me roughly $6,200 in lost rent and legal fees before it was over.

A co-signer or guarantor is supposed to be your safety net. They're the person who steps up and covers rent when your tenant can't. But here's the thing — a bad co-signer is worse than no co-signer at all, because they give you a false sense of security that leads you to approve applications you'd otherwise reject.

Let me walk you through exactly how I screen co-signers today, after 14 years of making mistakes so you don't have to.

Co-Signer vs. Guarantor: What's the Difference?

Before we get into the screening process, let's clear up a confusion that trips up a lot of landlords.

A co-signer signs the lease itself. They're a party to the rental agreement and have the same legal obligations as the tenant. If rent is due on the first and the tenant doesn't pay, you can go after the co-signer immediately.

A guarantor signs a separate guaranty agreement. They guarantee the tenant's financial obligations but aren't technically a party to the lease. The practical enforcement is similar, but the legal mechanics differ slightly depending on your state.

For this article, I'll use the terms somewhat interchangeably since the screening process is identical. But when it comes to drafting the actual documents, that distinction matters — and you'll want an attorney to review your forms.

When Do You Actually Need a Co-Signer?

Not every weak application calls for a co-signer. Here are the situations where I'll consider one:

• College students renting their first apartment with no credit history and limited income
• Recent graduates starting new jobs who can show an offer letter but don't have pay stubs yet
• Applicants with thin credit files — not bad credit, but insufficient history
• Self-employed tenants whose tax returns show enough income but whose bank statements are inconsistent
• Immigrants or relocating professionals with strong employment but no domestic credit history

On the flip side, there are applicants I won't approve even with a co-signer: people with recent evictions, a history of property damage, or criminal convictions that pose a direct threat to the property or other tenants. A co-signer can cover financial shortfalls — they can't fix character problems.

Setting Co-Signer Qualification Standards

Here's where most landlords go wrong. They apply the same screening criteria to co-signers that they'd use for tenants. That's a mistake. Your co-signer needs to be financially stronger than a typical approved tenant because they're covering two households.

Income Requirements

For a standard tenant, I require income of 3x the monthly rent. For a co-signer, I bump that to 4x to 5x the monthly rent — and that's their income alone, separate from the primary tenant's earnings.

Here's the math on a $1,800/month apartment:

Why so high? Because the co-signer still has their own mortgage or rent, their own car payment, their own groceries to buy. If they're already stretched thin on their own budget, they won't be able to cover your tenant's rent on top of everything else. I learned that the hard way.

Credit Score Thresholds

I require a minimum credit score of 700 for co-signers. Some landlords go as low as 680, but I've found that the 700 line correlates strongly with actual ability and willingness to pay.

Beyond the score itself, I dig into the credit report for:

• Payment history: Are they consistently paying on time? One 30-day late from three years ago is fine. A pattern of late payments in the last 12 months is a dealbreaker.
• Total debt load: Someone with a 720 score but $95,000 in consumer debt is a much bigger risk than someone with a 705 score and minimal debt.
• Available credit utilization: If they're using 80%+ of their available revolving credit, they're living on the edge financially.
• Bankruptcies or judgments: Any bankruptcy in the last 7 years is an automatic disqualification for me.

Assets and Net Worth

This is the piece most landlords skip entirely. I want to know that my co-signer has liquid assets — savings, investments, retirement accounts — that could cover at least 6 months of rent if they needed to step in.

Why? Because job loss happens. A co-signer with a fat savings account can weather losing their job and still cover your tenant's rent while they look for new work. A co-signer who's living paycheck-to-paycheck at $90,000/year is one layoff away from being useless to you.

The Complete Co-Signer Screening Process

Treat the co-signer application with the same rigor you'd apply to any tenant — actually, more rigor. Here's my step-by-step process.

Step 1: Full Written Application

The co-signer fills out the same rental application your tenants complete. Every field. No shortcuts. I want:

• Full legal name, date of birth, Social Security number
• Current address and how long they've lived there
• Employer name, title, salary, and length of employment
• Bank account information (we verify this, not access it)
• Personal and professional references
• Authorization to run credit and background checks

Some co-signers push back on this. "Why do you need all that? I'm not going to be living there." I politely explain that they're taking on the same financial liability as the tenant, so they go through the same screening. If they won't complete the application, that tells me everything I need to know.

Step 2: Income Verification

I verify income using at least two of the following:

• Last 3 pay stubs showing gross and net income
• Two most recent tax returns (especially for self-employed co-signers)
• Employment verification letter directly from HR on company letterhead
• Bank statements from the last 3 months showing consistent deposits

I never accept a co-signer's verbal claim of income. I've had people tell me they make $120,000 a year when their actual W-2 showed $67,000. People exaggerate. Documents don't.

Step 3: Credit Check and Background Screening

Run a full credit report and background check. I use the same tenant screening tools built into PropsManager that I use for primary applicants. The platform pulls credit reports, criminal history, and eviction records all in one place, which saves me from juggling three different services.

Look beyond the credit score. I review the full report for collections, judgments, liens, and any patterns that suggest financial instability.

Step 4: Verify Their Housing Situation

This is something I started doing after getting burned. I want to know whether the co-signer owns their home or rents. If they rent, what's their monthly payment? If they own, what's the mortgage balance versus the home value?

A co-signer who owns a $400,000 home with $150,000 left on the mortgage is in a fundamentally different position than one who's renting a $2,200/month apartment and barely making ends meet.

Step 5: Personal Interview

I always have a phone or video conversation with the co-signer. I explain clearly what they're agreeing to:

• They will be legally responsible for all rent, fees, and damages if the tenant doesn't pay
• I will pursue them for collections, including potentially filing a lawsuit
• This obligation survives even if the tenant moves out before the lease ends (in most cases)
• Their credit could be affected if the matter goes to collections

You'd be surprised how many co-signers don't fully understand what they're signing up for. About one in five backs out after this conversation, which honestly saves everyone a headache down the road.

Drafting an Airtight Guaranty Agreement

The guaranty agreement is the document that actually gives you legal recourse. A handshake and a signature on the lease aren't enough. You need a properly drafted, standalone guaranty document.

Essential Clauses to Include

Your guaranty agreement must include these provisions:

• Joint and several liability: The co-signer is equally responsible for all obligations, not just rent. This covers late fees, damage beyond normal wear and tear, cleaning costs, and even legal fees if your lease allows.
• Unconditional guarantee: The co-signer can't argue that they shouldn't have to pay because the tenant had a dispute with you, or because the apartment had a maintenance issue.
• Waiver of notice: You can pursue the co-signer without first giving them notice of the tenant's default (check your state laws on this — some states require notice).
• Survival clause: The guarantee continues even if the lease converts to month-to-month, the tenant renews, or the lease is modified.
• Full term coverage: The guarantee covers the entire lease term plus any holdover period.
• Attorney's fees clause: If you have to sue to collect, the co-signer is responsible for your legal costs.

Common Guaranty Mistakes

I've reviewed guaranty agreements from other landlords that had gaping holes. Don't make these mistakes:

Limiting liability to "rent only." If the tenant trashes the place and causes $8,000 in damage, you want the co-signer on the hook for that, too.

Not specifying lease renewals. I had a landlord friend whose guaranty only covered the initial 12-month term. When the tenant renewed for another year and then defaulted, the co-signer walked away scot-free. The judge agreed — the guaranty was silent on renewals.

Accepting digital-only signatures without proper authentication. Depending on your jurisdiction, a guaranty might be challenged if the co-signer claims they never actually signed it. Use a witnessed signature, notarization, or a verified e-signature platform.

Handling Out-of-State Co-Signers

About 40% of the co-signer applications I see involve someone in a different state — usually a parent co-signing for a college student. This creates real complications.

Jurisdictional Challenges

If your tenant is in Ohio and the co-signer lives in California, which state's courts do you file in? Generally, you'd sue in the state where the property is located, but enforcing a judgment across state lines adds cost and time.

Here's what I recommend:

• Include a jurisdiction clause in your guaranty stating that the co-signer consents to jurisdiction in your state's courts
• Require a higher income threshold — I bump my requirement to 5x rent for out-of-state co-signers
• Consider requiring a larger security deposit where legally permitted
• Get the guaranty notarized for easier enforcement across state lines

When to Decline an Out-of-State Co-Signer

If the co-signer lives in a state that's notoriously difficult for creditor enforcement — or if they're in another country entirely — think hard about whether the guaranty is actually worth the paper it's printed on. A guaranty you can't realistically enforce is just decoration.

Alternatives to Traditional Co-Signers

The co-signer model isn't perfect. It creates awkward family dynamics, it's logistically complicated, and enforcement is a hassle. Here are some alternatives I've started using:

Larger Security Deposits

Where state law allows, requiring a larger security deposit (2-3 months' rent) from applicants who don't quite meet income or credit thresholds can provide the same cushion without the interpersonal complexity. Just make sure you're compliant with your state's deposit limits.

Prepaid Rent

Some landlords accept several months' rent upfront. This is legally tricky in some jurisdictions, so check your local laws, but it gives you a genuine cash cushion.

Guarantor Services

Companies like Insurent and TheGuarantors act as institutional co-signers. The tenant pays a fee (usually around 80-100% of one month's rent), and the company guarantees the lease for the full term. I've found these work well for professional relocations and high-rent markets.

Higher Income Thresholds Without a Co-Signer

Sometimes the simplest solution is adjusting your approval criteria. If an applicant has a 660 credit score but makes 5x the monthly rent with two years of stable employment, maybe you don't need a co-signer at all.

Co-Signer Screening Checklist

Use this checklist every time you evaluate a co-signer:

• Full written application completed
• Government-issued photo ID verified
• Income verified at 4x–5x monthly rent (pay stubs + tax returns)
• Credit report pulled — score 700+
• Credit report reviewed for red flags (collections, late payments, high utilization)
• Background check completed (criminal + eviction history)
• Liquid assets verified at 6+ months of rent
• Housing situation confirmed (own vs. rent, monthly payment)
• Phone/video interview conducted
• All obligations clearly explained and understood
• Guaranty agreement signed (notarized if out-of-state)
• Copies of all documents saved to tenant file

With PropsManager's document management system, you can store all co-signer screening documents alongside the tenant's file — applications, credit reports, guaranty agreements, everything in one searchable place.

Managing the Co-Signer Relationship Over Time

Screening is just the beginning. You also need a plan for what happens when things go sideways.

When the Tenant Stops Paying

The moment rent is late, I send notice to both the tenant and the co-signer simultaneously. Don't wait until the tenant is three months behind. Early communication gives the co-signer a chance to nudge the tenant — or step in and pay before the situation spirals.

My process:

1. Day 1 past due: Automated late notice to tenant (PropsManager handles this automatically)
2. Day 5: Personal email or call to both tenant and co-signer
3. Day 10: Formal demand letter to co-signer via certified mail
4. Day 15: Begin eviction proceedings and simultaneously file a demand against the co-signer

Annual Re-Verification

For multi-year leases or lease renewals, I re-verify the co-signer's financial situation annually. People's circumstances change. The parent who made $110,000 when they signed might have retired, downsized, or taken on significant debt. A quick check protects you from relying on a guarantee that's no longer worth anything.

If you're still tracking tenant screening results and lease renewals manually, it's worth looking into how PropsManager automates renewal workflows so nothing slips through the cracks.

Red Flags That Should Make You Walk Away

After screening hundreds of co-signers, here are the warning signs that tell me to decline:

• Reluctance to provide financial documentation. If they won't show you the money, they probably don't have it.
• Already co-signing for other tenants. One co-signer supporting multiple rental obligations is a house of cards.
• Unstable employment history. Three jobs in two years doesn't inspire confidence.
• High debt-to-income ratio. Even with a good credit score, if 45%+ of their income goes to debt payments, they're one unexpected expense away from being unable to help.
• Emotional pressure. "I'm only doing this because my son begged me." That person is unlikely to actually pony up $1,800/month when the time comes.
• Unwillingness to be interviewed. If they won't spend 15 minutes on the phone, they're not taking this seriously.

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Frequently Asked Questions

Can a co-signer remove themselves from the lease?

Not unilaterally. A co-signer is bound by the guaranty agreement for its full term. However, if the tenant's financial situation improves significantly — say their income increases to 3x+ rent and their credit hits 700 — you might agree to release the co-signer as part of a lease renewal. You're never obligated to do this, but it can be a goodwill gesture that strengthens the tenant relationship.

What credit score should a co-signer have?

I recommend a minimum of 700 for co-signers. This is higher than the typical 620-650 minimum most landlords set for tenants, and for good reason: the co-signer needs to demonstrate strong financial responsibility since they're backing someone who couldn't qualify on their own. Some premium properties require 720 or higher.

How much income should a co-signer earn?

A co-signer should earn at least 4x to 5x the monthly rent in gross income. For a $1,500/month apartment, that's $6,000–$7,500/month or $72,000–$90,000 annually. This higher threshold accounts for the fact that they're maintaining their own household expenses while guaranteeing your tenant's rent. For out-of-state co-signers, I push the requirement to 5x.

Can I require a co-signer for some applicants and not others?

Yes, but you need to apply the standard consistently to avoid fair housing complaints. Document your screening criteria clearly — for example, "any applicant with a credit score below 650 or income below 3x rent must provide a qualified co-signer." Apply that rule to every applicant equally, regardless of protected class status. Using standardized screening workflows in PropsManager helps ensure consistency.

What happens if the co-signer dies during the lease term?

The co-signer's estate typically remains liable for obligations that accrued before death, but future obligations are murkier and depend on your state's laws and the specific language of your guaranty. This is why I include a clause requiring the tenant to provide a replacement co-signer within 30 days if the original co-signer dies, becomes incapacitated, or files for bankruptcy. If the tenant can't produce a replacement and still doesn't meet your qualification standards independently, you have grounds to non-renew the lease at term's end.

Protect Your Investment with Better Screening

Accepting a co-signer should reduce your risk, not create new ones. The 30-45 minutes it takes to properly screen a co-signer is nothing compared to the months of unpaid rent and thousands in legal fees you'll face if you skip the due diligence.

Every co-signer screening I do follows the same process, every time. No exceptions, no shortcuts. That consistency is what's kept me from repeating the $6,200 mistake I mentioned at the start of this article.

If you're managing multiple properties and juggling applications, co-signer documents, and guaranty agreements across spreadsheets and email threads, you're making this harder than it needs to be. PropsManager centralizes your entire screening workflow — tenant applications, co-signer verification, document storage, and automated payment tracking — in one platform built specifically for landlords.

Ready to streamline your tenant and co-signer screening? Request a demo and see how PropsManager can save you hours on every application while protecting your rental income.