Someone agreed to be a guarantor for a tenant's Private Residential Tenancy (PRT) in Scotland, signing a formal Deed of Guarantee. But later, perhaps due to changed circumstances or second thoughts, they want to withdraw. Is this possible?
Generally, no, a guarantor cannot simply withdraw from a legally binding Deed of Guarantee once it has been properly signed and the tenancy it relates to has commenced.
Why Not? The Binding Nature of the Deed:
- Legal Contract: A Deed of Guarantee is a serious legal contract between the guarantor and the landlord. Like most contracts, it cannot usually be cancelled unilaterally by one party just because they've changed their mind.
- Landlord Reliance: The landlord likely relied on the existence of the guarantee when granting the tenancy to the tenant. Allowing guarantors to easily withdraw would undermine the security the guarantee provides.
When Might a Guarantee End?
- End of Obligation (As Defined in Deed): The guarantee obligation ends when the conditions specified within the Deed of Guarantee itself are met. This usually relates to the tenant fulfilling all their obligations under the specific tenancy agreement the Deed covers. If the Deed covers the entire duration of the tenant's occupancy, the obligation continues as long as the tenant lives there under that tenancy framework.
- Mutual Agreement: The guarantor could be released if the landlord explicitly agrees in writing to release them from their obligations. A landlord is unlikely to agree unless the tenant can provide an alternative guarantor or demonstrate they no longer require one (e.g., improved financial standing).
- Specific Clauses (Rare): Very occasionally, a Deed might contain highly specific clauses allowing withdrawal under certain limited circumstances, but this is not standard.
Importance of Understanding Before Signing: This highlights why potential guarantors must fully understand the long-term commitment before signing a Deed of Guarantee. Seeking independent legal advice is strongly recommended. Legalmaster™ provides clearly drafted, compliant Deeds of Guarantee, but the guarantor must read and understand the terms before executing it.
Once signed, a guarantor is typically bound for the period specified in the Deed. If you have questions about generating a Deed of Guarantee, contact Legalmaster™ on 0333 340 8984.
