Residential Lease Agreements and Personal Guarantees

By Lane V. Erickson, Attorney

The issue of guarantees and/or co-signers on a lease agreement is related to the issue of who the parties to the lease agreement are. The person who owns the property and is renting the property is the landlord. The person who is renting the property is the tenant. Even though these are the basic parties to a lease agreement there are instances where there might be other parties involved as well. These additional parties include persons who guaranty and/or co-sign the lease agreement but who are not actually tenants renting the property. This happens often when you have a young tenant, such as a college student, who may be renting from a landlord for the first time.

A “‘[g]uaranty’ is an undertaking or promise on the part of a guarantor which is collateral to a primary or principal obligation and binds the guarantor to performance in the event of nonperformance of the principal obligor.” Industrial Inv. Corp. v. Rocca, 100 Idaho 228, 596 P.2d 100, appeal after remand, 102 Idaho 920, 643 P.2d 1090 (1979).

Black’s Dictionary defines a guaranty as:

A collateral agreement for performance of another’s undertaking. An undertaking or promise that is collateral to primary or principal obligation and that binds guarantor to performance in the event of nonperformance by principal obligor. A promised answer for payment of debt or performance of obligation if person liable in first instance fails to make payment or perform obligation. An undertaking by one person to be answerable for the payment of some debt, or the due performance of some contract or duty, by another person, who himself remains liable to pay or perform the same. A promised answer for the debt, default, or miscarriage of another person.

Hudson v. Cobbs, 115 Idaho 1128, 1131 (Idaho 1989).

Essentially, a guaranty is nothing more than an agreement by a third party, such a a parent, to pay a lease payment when it comes due if the renter (child) who owes the payment fails to pay. Again, the best example of this is when a parent co-signs on a lease agreement for their child. The child gets the apartment and is obligated to make the monthly payments. However, if the child defaults in payment, the lender can seek the payment from the parent as well as the child.

There are no State or federal laws that prohibit a third person from signing a guaranty on a lease agreement for another. The practice is very common in communities with a university or college.  Typically it is a parent who guaranties or co/signs on the lease agreement for their student child. This is a great way for a landlord to have some peace of mind when renting to younger tenants whose tenancy may be brief or who may not have previous experience as a tenant.

If you are a landlord or a renter and you have questions about co-signing on a lease agreement, we can help. Call us toll free at 877-232-6101 or 208-232-6101 for a consultation with Lane Erickson and the Racine Olson team of Landlord and Tenant Law and Real Estate attorneys in Idaho. You can also email Lane Erickson directly at We will answer your Idaho Landlord and Tenant Law and Real Estate questions and will help you solve your Idaho Landlord and Tenant Law and Real Estate needs.

This website includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer for advice on specific legal issues.

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