What’s covered by Padder Guarantor?

Padder Guarantor is designed to help renters who may not qualify for a lease on their own, while providing property owners and operators with coverage to mitigate the risk of tenant default.

Here’s what Padder Guarantor covers:

• Missed Rent Coverage:

  • If a renter defaults on their lease, Padder Guarantor covers the missed rent for property owners and operators. This helps ensure consistent income and reduces the risk of bad debt.

• Coverage Duration:

  • Coverage can be tailored to the duration of the lease.
  • For a 12-month lease, coverage can be for 6 or 11 months.
  • Upon lease expiration, the tenant must reapply and requalify for the Guarantor product.

• Flexible Terms in Canada:

  • Leases often go month-to-month after the first year. Padder allows landlords to select the coverage and duration for each applicant.
  • Options include 6 or 12 months of coverage and durations of 12, 24, or 36 months.
  • If a default occurs within the policy duration, landlords receive the selected amount of coverage.

• Example Coverage:

  • For instance, if a landlord requires a tenant to purchase 12 months of rental coverage for a 30-month duration on a $2,000 lease, and the tenant defaults in month 18, the landlord is entitled to up to $24,000 in loss coverage.

• Payment of Rent:

  • Padder Guarantor pays the rent that the renter was supposed to pay, including any rent in arrears and missed rent going forward until a new renter is found.

• Exclusions:

  • Padder Guarantor does not cover penalties, accelerated rent, damages, or legal fees. These can be covered by the Last Month's Rent deposit.
  • Padder Guarantor does not pay if the renter is not obligated to pay, such as in cases of constructive eviction determined by a court.

• Special Situations:

  • If the tenant declines to take possession of the apartment or does not take possession within 15 days after the lease commencement, the landlord will receive a maximum of two months of fixed rent.