The Guarantors for New York Tenants

Picture: Boyko Blagoev on Flickr

If you are a student or a recent graduate, and especially not an American citizen, you probably know how much hustle it takes to rent an apartment in New York City. In order to go through the whole process of NYC apartment rental bullshit, you first need to struggle finding a place, and then meet all the strict requirements landlords and buildings impose. Requirements for renting an apartment in New York are so high, that sometimes people, who can afford apartments they want, are not able to rent them. This is due to absurd requirements imposed by building owners and landlords.

Often you can see a requirement for a credit score of 700 along with an annual income 34 times or more than one month’s rent as a must. Many landlords would also want your guarantors to be located in New York, which is highly inconvenient if your guarantors are parents who live in a different city or even country.

But boom, a new startup is aiming at disrupting the status quo. The New York City tech company The Guarantors is aiming at helping renters who are struggling with renting accommodations they could otherwise afford. The platform would suit international workers, students, and anybody else who might be experiencing difficulties renting in New York (everybody, no?!).

Here is how it works. If you are approved, your landlord will receive a Surety Bond by The Hanover Insurance Group. In case you stop paying your rent, landlords can use the insurance to get the rent that did not receive and cover legal fees. Notwithstanding the third party providing the bonds, the startup itself is responsible for making sure users will be able to pay. The Guarantors uses their technology with some fancy algorithms that allow them to evaluate candidates and determine if they would actually be able to pay for a house they want.

The Guarantors charges five to ten percents of an annual rent for its service costs. It’s pretty much the same fee, or even a bit smaller, than an usual broker’s fee. The startup also, in theory, eliminates the need to pay several rents in advance or leave a massive security deposit. With all these perks, the startup’s existence sounds more than reasonable for New York City. Moreover there are about 10 more cities that might have a similar barriers to rent; Boston potentially can be one of them.