NEWS

When renting real estate in Japan, one particularly important element for foreigners is the guarantor. The guarantor plays a role in supplementing the tenant's creditworthiness during the lease agreement, and is an essential requirement in many rental contracts. This article explains the necessary guarantor for foreigners renting real estate in Japan, while also discussing guarantor companies, which are becoming alternatives to guarantors.

When foreign nationals enter into a lease agreement in Japan, a guarantor residing in Japan is typically required. The guarantor serves as a surety to ensure the creditworthiness of the lease agreement and provides assurance to the landlord (property owner) or real estate management company. General conditions for guarantors include:

1. Japanese citizenship or resident in Japan: Guarantors are usually required to be Japanese citizens or registered residents of Japan.

2. Economic stability: Guarantors must demonstrate sufficient economic stability to comply with the lease agreement. Information such as the guarantor's income and occupation may be required when entering into a lease agreement.

3. Communication skills: Guarantors typically need to have a basic understanding of Japanese and communication skills to navigate contracts and procedures. This is essential for understanding lease agreement information and facilitating communication and procedures when necessary.

While foreigners may sometimes serve as guarantors, Japanese residents are generally preferred. However, specific conditions may apply, so it is important to confirm individual contract requirements.

Finding someone willing to act as a guarantor for foreign nationals starting their lives in Japan can often be challenging. Consequently, it has become increasingly common for landlords to waive the requirement for a guarantor in exchange for tenants entering into a guarantee contract with a guarantor company specified by the landlord.

Guarantor companies act as proxies for guarantors in lease agreements, receiving a guarantee fee from the tenant in return. The guarantee fee typically ranges from 50% to 100% of the rent for the property (e.g., for a monthly rent of ¥200,000, the guarantee fee would be between ¥100,000 and ¥200,000). This fee is incurred only once upon entering into the guarantee contract. Subsequently, a monthly guarantee fee of approximately 1% to 2% of the rent may be charged for the duration of the lease agreement.

Recently, there has been a rise in guarantor companies offering specialized services for foreigners, alleviating the struggle for foreign tenants to find guarantors.

Lastly, here are some guarantor companies offering services tailored for foreigners.

Global Trust Networks
https://www.gtn.co.jp/

Japan Rental Guarantee Co.
https://jid-net.co.jp/jp/


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