Is it okay to live without a guarantor? A complete guide to renting properties in Japan for foreigners
When signing a rental contract in Japan, you will almost always need a guarantor.
This system is unique to Japan and is not commonly seen overseas, so it can be confusing, especially for foreigners looking to rent an apartment in Japan.
In this article, we will explain the basics of the guarantor system for foreigners living in Japan, as well as how to sign a rental contract without a guarantor and what to be aware of.
Please use this as a reference to ensure your rental contract in Japan is successful.
1.What is the guarantor system for rental contracts in Japan?
A guarantor is a person who is responsible for paying rent and repair costs on behalf of the tenant if the tenant is unable to pay.
To avoid risks such as non-payment of rent, landlords generally ask tenants to provide a guarantor when signing a lease.
Main conditions for guarantors
Not everyone can be a guarantor for a rental property in Japan.
The guarantor must meet the following requirements:
- Living in Japan
- Being a family member or relative
- Having a stable income
In addition to these points, the guarantor's "creditworthiness (FICO score)" may also be examined, such as whether they have any rent arrears or large amounts of debt.
The guarantor is responsible for paying overdue rent and other payments on behalf of the tenant, so their relationship with the tenant and their financial strength are important.
The difference between a guarantor and a joint guarantor
There are two types of guarantors for rental properties in Japan: "guarantor" and "joint guarantor," and the scope of responsibility they bear differs.
| item | Guarantor | Guarantor |
| Scope of responsibility | Only pay the overdue rent | In addition to paying overdue rent, you are also responsible for restoring the property to its original condition and dealing with noise problems. |
| Claims from the landlord | First, request the tenant (direct request not possible) | Can be billed directly (You can claim without mentioning the tenant) |
| Heavy responsibility | Relatively light | bear the same responsibilities as the tenant |
Whether you need a guarantor or a joint guarantor depends on the contract terms. In some cases, you may need both a guarantor and a joint guarantor.
Because a joint guarantor bears greater responsibility than a mere guarantor, part of the Civil Code was revised in 2020 to clarify the scope of a joint guarantor's responsibility.
The new law requires that a maximum amount of the guarantee be set and that the details of that maximum amount be included in the contract. This revision makes it easier to request a joint guarantor.
2.Guarantor issues faced by foreigners
A guarantor is required to sign a rental contract for a property in Japan. However, foreigners may face the following problems:
- No family or relatives live in Japan
- It is difficult to find a Japanese guarantor
- The guarantor's responsibility is too heavy
- Language barrier
Also, even if your family or relatives live in Japan, they may not be able to act as guarantors due to their unstable income or the landlord's policy.
3.How foreigners can sign rental contracts without a guarantor
So, what should a foreigner do to sign a rental contract for a property in Japan?
We will introduce how to sign a contract without a guarantor.
1. Guarantor introduction system
There is a system in place to introduce guarantors to people who have difficulty securing housing, such as the elderly and foreign households.
For example, the General Incorporated Foundation for Senior Citizens' Housing acts as a guarantor for foreign households who have a residence card or special permanent resident certificate.
However, you can only sign contracts with rental housing affiliated with the Senior Housing Foundation, so you cannot freely move into the area or property you want to live in.
2. Properties that do not require a guarantor
Real estate companies that handle rental properties for foreigners also offer properties that do not require a guarantor.
For example , Mooovin provides all users with the service of a guarantor company for foreigners. If you pass the screening, you can move in without a guarantor.
However, even if you don't need a guarantor, you will still need to use the guarantee service provided by the real estate company. The fee varies depending on the property, and in some cases you will be required to pay 100% of the monthly rent when you move in, and monthly guarantee fees thereafter.
However, all properties handled by this real estate company can be rented without a guarantor, so you will be able to find a room that suits your needs in the area you want to live in.
3. Guarantor service
Guarantor agency services provide guarantee services for people who are unable to provide a guarantor.
In many cases, the property management company or real estate company will act as a guarantor on your behalf, so if you would like to use a guarantor agency, please inform the real estate company.
However, this service is not available for all properties.
There is also a cost involved in using a guarantor service. While this varies depending on the company, the going rate is 50% to 100% of the rent.
4. Rent Guarantor Company
A guarantee company is a company that specializes in acting as a guarantor.
The tenant pays a certain amount of commission to the guarantor company, which provides the landlord with a guarantee in the event of rent arrears.
The major difference from guarantor agency services is that the guarantee is provided by a company separate from the real estate company, allowing users to search for properties freely.
| Provider | Available properties | |
| Guarantor service | Management companies/real estate companies | Properties offered by the management company or real estate company |
| Guarantor | Specialized companies and businesses | Generally available for almost all properties |
The standard commission fee is 50% to 100% of the rent, just like with guarantor services.
There are an increasing number of companies that provide services for foreigners, so if you are unable to use a guarantor agency service, you may want to consider using a guarantor company.
5. Rented company housing that welcomes foreigners
Company-rented housing is when a company contracts for a property on behalf of an individual and provides a place for employees to live.
It seems that many companies that employ a large number of foreigners actively make use of rented company housing.
Not only can you move in without a guarantor, but it also saves you the trouble of finding an apartment and signing a contract, making it a particularly convenient system for foreigners who are not familiar with Japan.
However, of course, only people who work for that company can live there.
If you are looking for a job, it is a good idea to check whether there are any company-rented housing available that is suitable for foreigners.
4.How to Use a Guarantor Company for Rental Properties in Japan
Guarantor companies are available for a wider range of rental properties and are easy for foreigners to use.
To use a guarantor company for a Japanese rental contract, you will need to submit the necessary documents and undergo an examination (required documents vary depending on the company).
The real estate company will introduce you to a guarantor company, or you can find one and sign a contract yourself.
It is especially important for foreigners to choose a guarantor company that they can use with confidence.
What is a guarantor company?
A guarantor company is a specialized company that acts as a joint guarantor.
By signing a contract with a guarantor company separately from the real estate company, tenants can find a room that suits their needs from a wider range of properties.
Points to consider when choosing a guarantor company
When choosing a guarantor company to sign a contract for a rental property in Japan, please pay attention to the following points:
- Is the company offering services for foreigners? There are also guarantor companies that do not even consider foreigners as their customers. If the company offers services for foreigners, they will be able to handle contract details and inquiries in foreign languages, and landlords will be able to rent out their rooms with peace of mind.
- Supported languages: Many guarantee companies support not only English, but also Asian languages such as Chinese, Vietnamese, and Korean. It is best to choose a company that supports your language.
- Is the screening process too strict?: Since the screening process involves factors such as income, place of employment, and residence status, it is best to choose a company that is not too strict.
- Cost: The average cost is 50% to 100% of the rent. We recommend a company that can accommodate you within that range.
- Support system: In addition to guaranteeing against rent arrears, some guarantor companies also offer their own unique services, such as responding to problems and providing advice on worries about living in Japan. Please pay attention to these services to ensure a safe and secure life in Japan.
5.Points to note when using a rent guarantee company
Here are some things to keep in mind when using a guarantee company:
1. You cannot use it unless you pass the screening.
To use a guarantor company, you must submit the necessary documents and undergo an examination.
If you do not pass this screening, you will not be able to use a guarantor company.
When using a guarantee company that offers services for foreigners, it will be easier for foreigners to pass the screening.
2. Guarantee fees are charged, so the burden can increase depending on your choice
To use a guarantor company, you will need to pay an initial guarantee fee (50% to 100% of the rent), as well as a monthly guarantee fee (1% to 2% of the rent) after moving in, and in some cases a renewal fee (around 10,000 yen) after 1 to 2 years.
Conditions vary depending on the insurance company, so be sure to check in advance.
3. If you fail to pay your rent, you will be in big trouble.
When rent is overdue, the guarantor company will pay the rent to the landlord instead. However, this does not mean that the tenant is no longer responsible for paying. The guarantor company will bill the tenant for the amount paid.
If you fail to repay the guarantor company, legal action will be taken in accordance with the contract. This may ultimately lead to the seizure of your salary or assets, so be sure to pay your rent by the due date every month.
4. Risk of rent guarantee company going bankrupt or going bankrupt
If the guarantor company goes bankrupt or goes out of business, it will affect the user as well.
Specifically, the contract with the guarantor company will be terminated, and the tenant will be left with no guarantee.
Therefore, you will have to find a replacement guarantor yourself or sign a contract with a new guarantor company.
In that case, you will need to pay the contract fee again, so it is important to sign a contract with a reliable guarantor company in advance.
6.If you want to sign a rental contract without a guarantor, we recommend rented company housing.
You can rent a house without needing a guarantor.
Therefore, if the company you are applying to owns rental housing, make it a priority to consider it.
Additionally, renting company housing offers the following benefits:
Advantage 1: No need to go through the trouble of finding a place to live
When you are unfamiliar with life in Japan, finding a new place to live can take time and effort.
If you rent a house, you don't have to search for a property yourself.
Rented housing is also often close to work, making it convenient for living.
Advantage 2: You can move in with peace of mind
Since the company has already signed a contract for the rental housing, there is no need to negotiate or sign a contract with the real estate company.
Most apartments come equipped with the bare minimum of furniture and appliances, so you can move in with just your personal belongings.
The company will also provide support after you move in, so you can live with peace of mind.
Advantage 3: Possible tax savings
Renting a house can bring tax savings not only to the company but also to the tenants.
This is because rent is deducted from your salary, reducing your income and, as a result, you can expect your income tax to be reduced.
The rent itself is often cheaper than regular rental properties, so there are significant financial benefits.
