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Cosigning a Lease: Your Legal Responsibilities

Whitney O’Sullivan

Cosigning a Lease: Your Legal Responsibilities

As college students across the country head back to class this fall, thousands of parents will cosign leases for their student’s off campus housing; housing that they likely haven’t seen. While students will be miles from home and out from under watchful eyes, parents nonetheless will be legally responsible for whatever happens to their student’s living space.

Cosigning a lease means that you can and will be just as responsible under the legal lease terms as the person you are cosigning for.

As with any lease, before you agree to sign, understand what you are agreeing to, and evaluate your relationship with the person(s) you are cosigning for. Typically, all signers of a lease will be “jointly and severally liable” for the lease terms. This means that each person is responsible together and individually for abiding by all provisions of the lease, including paying rent. If one party to the lease fails to uphold their end of the bargain, all other signers and cosigners will nonetheless be responsible for the total payments due, and it will be up to those parties to seek reimbursement from the deadbeat.

If one party to the lease fails to uphold their end of the bargain, all other signers and cosigners will nonetheless be responsible for the total payments due.

This also means that you, the cosigner, may be liable for any damage the lessees do to the premise (perhaps by sledding down the stairs at 3am?), or if they fail to properly clean before moving out.

Why Are Cosigners Necessary?

While deciding to cosign a lease may sound like nothing but trouble, it is often necessary for young people with little to no credit history, or anyone with a negative credit history. While not all landlords require a credit check, most do. Designating a qualified cosigner (aka someone with very good and established credit) reallocates risk away from the landlord and onto individuals.

Limit Your Exposure

Depending on the landlord and type of building, you may have options for limiting cosigner liability. Some college student buildings allow leases with several liability only, meaning that each signer will only be responsible (along with their cosigner) for their portion of the total rent. While rare, this takes lessees and cosigners off the hook should one roommate fail to pay their fair share.

A cosigner may also be able to limit the provisions of the lease that they are guaranteeing, and opt only to guarantee money due (i.e., the rent). This limits liability for damages to the premises. 

Lastly, a cosigner can seek a sub-agreement with the lessee, wherein the lessee offers collateral (say, his or her car), should the cosigner be forced to pay the landlord. The cosigner and lessee can also structure a repayment plan in the case the cosigner is forced to pay. While neither option protects the cosigner from paying the landlord, both do at least provide some assurances that the cosigner can recover his or her money from the lessee.

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While you may trust your particular college student, chances are that you do not know his or her friends or their financial situations. Convincing your child to live in on-campus housing, which may not require a guarantee from you, is the safest way to avoid this particular headache. However, if you decide that living off campus is the right choice (it’s often cheaper), limit your liability to the degree possible. Shake’s Roommate Agreements can help you assign proportionate liability, regardless of the primary lease terms.