Guarantor &
Co-Signer Guide.
Don't have Canadian credit history? A thin file? A guarantor or co-signer can be the difference between getting approved and getting ghosted. Here's everything you need to know about guarantors for Ontario rentals.
Understanding the Difference
A guarantor agrees to cover rent if the tenant defaults but is not on the lease as a tenant. They do not live in the unit and have no right to occupy it. Their role is purely financial — a safety net for the landlord in case the tenant stops paying rent or causes damage beyond normal wear and tear.
A co-signer, on the other hand, signs the lease alongside the tenant and shares full legal responsibility for all obligations under the lease. This means they are equally liable for rent, damages, and any other costs that arise during the tenancy. In some cases, a co-signer may also have the right to occupy the unit, depending on how the lease is structured.
In Ontario, the terms are often used interchangeably by landlords and property managers. Whether your landlord asks for a "guarantor" or a "co-signer," the key question is always the same: what exactly is the person signing, and what are they agreeing to be responsible for? Always read the agreement carefully to understand the specific obligations.
What the Guarantee Covers
A guarantee agreement typically covers rent payments, damages to the unit, and any other costs the tenant is liable for under the lease. This can include unpaid utility balances (if utilities are included in rent), cleaning costs, or legal fees if the landlord needs to pursue collection.
The guarantee usually lasts for the initial lease term — most commonly 12 months. When the lease converts to month-to-month (which happens automatically in Ontario after the initial term), the guarantor's obligation may or may not continue depending on the specific wording of the guarantee agreement.
This is one of the most important details to clarify before signing. Some agreements state that the guarantee ends at the conclusion of the fixed term. Others include language that extends the guarantor's liability until the tenancy ends entirely. If the wording is ambiguous, both the tenant and guarantor should ask for clarification in writing before anyone signs.
If you are unsure about the language in a guarantee agreement, it may be worth having it reviewed by a legal professional. Learn more about your rights as an Ontario tenant.
Common Scenarios
A guarantor is most commonly required when the tenant's financial profile does not meet the landlord's standard approval criteria on its own. Here are the most frequent situations:
- New to Canada: You have no Canadian credit history, no local references, and no established banking relationship. Even if you have excellent credit in your home country, Canadian landlords often cannot verify it. See our newcomer's rental guide.
- Student without income: Full-time students who do not have a steady source of employment income. Even with savings or parental support, many landlords require a guarantor as additional security.
- Self-employed with irregular income: Freelancers, contractors, gig workers, and business owners whose income fluctuates month to month. Landlords prefer predictable, verifiable employment income.
- Recovering from poor credit: If you have had previous financial difficulties — missed payments, collections, or a consumer proposal — your credit score may not meet the landlord's threshold, even if your current income is strong.
- First-time renter: No rental history means the landlord has no track record to evaluate. A guarantor provides assurance that rent will be covered even without a proven rental track record.
What Landlords Are Looking For
When a landlord asks for a guarantor, they are looking for someone who can step in financially if the tenant defaults. The guarantor's profile needs to be strong enough to offset the risk the landlord perceives in the tenant's application. Here is what most landlords evaluate:
- Stable income: Most landlords want the guarantor to earn 4–5 times the monthly rent in gross income. For a $2,500/month rental, that means $10,000–$12,500/month in income.
- Good credit score: A credit score of 700 or higher is typically expected. Some landlords will accept 680+, but 700 is the standard benchmark in the GTA market.
- Canadian residency: Landlords strongly prefer guarantors who live in Canada. It is easier to verify income, run a credit check, and pursue legal action if necessary.
- Willingness to sign: The guarantor must be willing to sign the guarantee agreement and undergo a credit check. Some guarantors hesitate once they understand the full scope of liability.
Some landlords will accept out-of-country guarantors if the guarantor can provide sufficient proof of assets, income, and the ability to transfer funds to Canada. This is more common with purpose-built rental companies than individual landlords.
Guarantor document checklists for newcomers and students are also covered in our Supporting Documents guide.
Required Documents
Your guarantor will need to provide a set of documents that allow the landlord to verify their identity, income, and creditworthiness. The exact requirements vary by landlord, but here is the standard list:
- Government-issued photo ID: A valid driver's licence, passport, or provincial photo ID card. The landlord needs to confirm the guarantor's identity and legal name.
- Proof of income: An employment letter on company letterhead confirming position, salary, and start date, plus recent pay stubs (typically the last two to three). Self-employed guarantors should provide their most recent Notice of Assessment or T1 General tax return.
- Credit report or consent: Either a current credit report (from Equifax or TransUnion) or written consent for the landlord to run a credit check. Many landlords prefer to pull the report themselves.
- Proof of Canadian residency: A utility bill, bank statement, or government correspondence showing a Canadian address. This confirms the guarantor lives in Canada and can be reached if needed.
Not sure what you need? Our agents help you prepare a complete application package — including guarantor documents — so nothing gets missed.
The Guarantee Agreement
The guarantee agreement is the legal document that binds the guarantor to their financial obligations. It is separate from the lease itself, although it references the lease terms. Before signing, both the tenant and guarantor should review the agreement carefully and understand every clause.
Here is what to look for in the agreement:
- Duration of liability: Does the guarantee end when the initial lease term expires, or does it continue into the month-to-month period? This is the single most important clause.
- Scope of financial responsibility: Is the guarantor liable only for rent, or also for damages, legal fees, and other costs? Understand the full extent of what could be owed.
- Conditions for termination: Can the guarantor request to be released after a certain period? What conditions must be met? Is there a formal process?
- Lease renewal and transfer: If the tenant signs a new lease (not just month-to-month), does the guarantee automatically transfer to the new lease term? Some agreements include this language.
Always read the fine print. Both the tenant and guarantor should keep a signed copy of the agreement for their records. If any clause is unclear, ask the landlord for clarification in writing before signing. Consider having a legal professional review the document if the financial stakes are significant.
Offer Additional Rent Upfront
If you cannot find a guarantor — or prefer not to involve one — some landlords will accept three to six months of prepaid rent as an alternative form of security. This demonstrates financial capability and reduces the landlord's risk without requiring a third party.
This is legal in Ontario as long as the prepayment is applied to rent (not held as a deposit). Under the Residential Tenancies Act, landlords can only collect a last month's rent deposit — they cannot demand a general security deposit. However, offering to prepay additional months of rent upfront is a voluntary arrangement that many landlords are open to.
To make this option work, show strong bank statements proving your ability to pay. Landlords want to see that prepaying several months of rent will not drain your savings completely. Ideally, your account balance after prepayment should still cover several additional months of living expenses.
If you are a newcomer or international student with funds from abroad, provide bank statements from your home country translated into English, along with proof of your ability to transfer funds to a Canadian account.
Other Options to Strengthen Your Application
Even without a guarantor or prepaid rent, there are several ways to improve your chances of getting approved:
- Transfer your international credit history: Services like Nova Credit allow you to transfer credit history from select countries (India, Mexico, South Korea, the Philippines, and others) to Canadian landlords. This can help bridge the credit gap for newcomers.
- Provide a detailed employment letter: A comprehensive letter from your employer that includes your salary, position, department, start date, and confirmation of permanent or contract status carries significant weight. If you have a signed offer letter for a new position, include that as well.
- Apply through a licensed rental agent: A knowledgeable agent can present your application professionally, highlight your strengths, and negotiate with the landlord on your behalf. This is especially valuable if your profile has non-traditional elements. Apply through TheRentalMarket.ca to get matched with a local agent at no cost to you.
- Look into newcomer rental programs: Some purpose-built rental companies in the GTA have dedicated programs for newcomers that do not require a guarantor. These programs may accept international credit, employment letters, or higher prepaid rent in place of a traditional guarantor.
If you are moving to the GTA from another country, read our complete guide to relocating to the Greater Toronto Area for more strategies and tips.
Ontario Human Rights Code
In Ontario, landlords have the right to screen tenants and assess their ability to pay rent. However, this screening must comply with the Ontario Human Rights Code, which prohibits discrimination in housing based on protected grounds including race, colour, ancestry, place of origin, citizenship, ethnic origin, creed, sex, sexual orientation, gender identity, age, marital status, family status, disability, and receipt of public assistance.
A landlord cannot require a guarantor in a discriminatory way. For example, requiring a guarantor only from applicants who are newcomers to Canada, while not requiring one from Canadian-born applicants with the same financial profile, could constitute discrimination based on place of origin or citizenship.
The key legal test is whether the guarantor requirement is applied consistently and based on legitimate financial criteria — such as credit score, income, or rental history — rather than on a protected characteristic.
If you believe a guarantor requirement is being applied in a discriminatory way, you have the right to file a complaint with the Human Rights Tribunal of Ontario. The complaint process is free and you do not need a lawyer, although legal assistance can be helpful. Learn more about your rights as an Ontario tenant.
For official information, visit the Ontario Human Rights Commission's policy on rental housing.
Guarantor's Rights & Responsibilities
Being a guarantor is a serious financial commitment, and the person agreeing to take on this role should fully understand their rights and the extent of their liability before signing anything.
- Right to documentation: A guarantor can request documentation of any default before being asked to pay. The landlord should provide evidence that rent is unpaid, including the amount owed and the period in arrears.
- Record keeping: Guarantors should keep detailed records of all payments made on behalf of the tenant. These records are important for tax purposes and in case of any future legal disputes.
- Cannot be evicted: Since a guarantor is not a tenant, they cannot be evicted from the rental unit. Eviction proceedings through the Landlord and Tenant Board apply only to tenants who occupy the unit.
- Liability after eviction: If the tenant is evicted, the guarantor may still be liable for rent arrears that accumulated during the tenancy. The guarantee agreement governs the extent of this liability.
- Right to pursue the tenant: If the guarantor pays rent on behalf of the tenant, they may have the right to pursue the tenant for reimbursement through Small Claims Court or other legal means.
Guarantors should approach this decision with the same seriousness as taking on a loan. Both parties benefit from open communication about the financial situation throughout the tenancy. If the tenant is struggling to pay rent, the guarantor should know early — not when the landlord comes calling.
We've helped hundreds of tenants without traditional credit get approved. One rental profile, one local agent — at zero cost to you.
Start Your Rental Profile →There is no specific law in Ontario that prohibits a landlord from requiring a guarantor. However, requiring one based on a protected ground — such as country of origin, age, receipt of public assistance, or family status — could violate the Ontario Human Rights Code. Landlords must apply guarantor requirements consistently and based on legitimate financial criteria, not on protected characteristics. If you believe the requirement is discriminatory, you can file a complaint with the Human Rights Tribunal of Ontario at no cost.
Most landlords prefer a Canadian-based guarantor because it is easier to verify income, run a credit check, and pursue legal action if necessary. However, some landlords — particularly larger purpose-built rental companies — will accept an international guarantor if they can provide sufficient proof of income, assets, and the ability to transfer funds to Canada. The strength of the overall application matters. If you are pairing an international guarantor with strong bank statements and an employment letter, you may still get approved.
It depends entirely on the wording of the guarantee agreement. Some guarantees explicitly state that liability ends at the conclusion of the initial fixed term (typically 12 months). Others include language that extends the guarantor's obligation until the tenancy ends or until the landlord formally releases the guarantor. Read the agreement carefully before signing and ask for clarification on this specific point. If the language is ambiguous, request that it be clarified in writing.
You can ask your landlord to release the guarantor, typically after 12 months of consistent on-time rent payments and an improved credit profile. However, the landlord is not obligated to agree. It is a negotiation — the stronger your financial profile has become (higher credit score, stable income, clean rental history), the more likely the landlord is to release the guarantor. Put your request in writing and include supporting documents like updated pay stubs and a current credit report.
If the tenant defaults on rent and the guarantor cannot pay, the landlord can pursue the guarantor through Small Claims Court (for amounts up to $35,000) or Superior Court for larger amounts. A court judgment against the guarantor will affect their credit score and may result in wage garnishment or other collection actions. Both the tenant and guarantor may face legal consequences. This is why it is critical for guarantors to fully understand the financial risk before signing — and for tenants to communicate early if they are having difficulty making rent.