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If I act as someone's guarantor, can they see all the financial information I'm giving the landlord?

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How much total do you plan to tip the building staff this year?

Question:

If I act as someone's guarantor, can they see all the financial information I'm turning over to the broker and landlord? And what will happen to all my bank statements—and other paperwork—after the application process? I want to make sure my privacy is protected since I'm sharing so much sensitive information.

Answer:

While it's certainly understandable to be anxious about turning over such a large amount of information on your finances, the process can essentially be as private as you want it to be.

"In many cases, the parent is the guarantor, so their kid just asks them if they make $500,000/year, or whatever the necessary amount of money is," explains Jeffrey Geller, vice chairperson and COO of Insurent (FYI, a Brick sponsor). "And oftentimes, it's their kid who's renting that sends along all the financial information for the application."

But it can just as easily go the other way. "If they want to, they can send it directly to us," adds Geller, "and then the renter won't see the information. We keep it immensely confidential."

Whether you're going to an institutional guarantor or a broker, simply let them know that you'd like your information to be kept private from the renter you're guaranteeing, and they should be more than willing to comply. "It's really up to you whether you feel comfortable with the tenant seeing your financial documentation," concurs Citi Habitats broker Andrew Sacks, who makes it a point to ask the guarantor one essential question: "Do you want to keep your paperwork completely separate and private, or are you guys open about that type of thing?"

And in a situation with multiple roommates—and multiple guarantors—the procedure is pretty much the same. "Sometimes we'll be working with roommates so taking in applications from each of the kids, as well as each of the parents, and of course each parent says they don't want the others to see their financial information," says Lawrence Lee, an agent at TripleMint (a Brick partner). "One of our primary jobs in that regard is to keep everything very, very private."

For an added layer of security, says Sacks, some clients opt to send over their bank statements and other personal information as password protected documents. (Email services like Outlook have an option for this, and you can set up password protection for individual PDF and Microsoft Office documents as well.)

And once the broker, instutional guarantor, or landlord has your documents, you can generally expect that they'll be shredded and disposed of once the application is complete. "If it's physical, we shred it, and if it's a PDF, we have it permanently erased," confirms Lee.

Adds Geller: "All those documents are treated with the utmost confidentiality and are used in-house to qualify the renter, and are not disseminated to any third party." 

So while you'll certainly be taking a financial risk by acting as a guarantor, from a security standpoint, you shouldn't have much cause for concern.