Renting without a guarantor now rent-in-advance is capped

General information only, not legal advice. Verify your specific circumstances with a qualified professional.

For years, the unofficial workaround for tenants who could not produce a guarantor was simple, if painful: hand over six months’ rent upfront. Landlords got security; tenants got a roof. It was expensive, it was inequitable, and — as of 1 May 2026 — it is no longer lawful.

The Renters’ Rights Act 2025 has effectively capped advance rent at one month for all new tenancies. Section 9 bans landlords and agents from inviting, encouraging or accepting any rent payment before the tenancy is signed, and section 8 makes any term requiring rent to be paid in advance during the tenancy of no legal effect. The combined result is that the old six-months-upfront route is gone. Requiring or accepting a prohibited pre-tenancy payment now carries a civil penalty of up to £5,000 for a first breach; a repeat breach within five years is a criminal offence, with a civil penalty of up to £30,000 available as an alternative to prosecution.

That leaves renters who struggle with guarantors — students, recent arrivals, those on benefits, anyone with thin or patchy credit history — needing to understand what genuinely remains. And it leaves landlords and agents needing to know what risk-mitigation tools still work.

Why guarantors have always been a problem

A conventional guarantor is typically a UK-based adult — often a homeowner — earning enough to cover the rent comfortably; many landlords and agents look for an income of around three times the annual rent. For many tenants, finding someone who meets all of those criteria — and is willing to sign a legally binding agreement taking on joint liability — is the real obstacle, not the rent itself.

Shelter’s guidance notes that landlords most commonly ask for guarantors from students, first-time renters, people moving to the UK from overseas, those on low incomes, and people getting benefits. In other words, the groups with least access to the homeowning, high-earning social networks that produce conventional guarantors. The old six-months-upfront route papered over this structural gap. Now that route is closed.

What landlords can still require

Capping advance rent does not stop landlords from protecting themselves. As of June 2026, permitted options include:

• One month’s rent in advance — still allowed, collected after both parties have signed the tenancy agreement (not before)
• A security deposit — still capped at five weeks’ rent, or six weeks where the annual rent is £50,000 or more, under the Tenant Fees Act 2019
• A guarantor agreement — still fully legal, still a common and effective risk-management tool
• Thorough tenant referencing — credit checks, employment verification, previous landlord references; no change here

What has changed is the sequencing. No rent at all can be collected before both parties have signed. After signing, a landlord can collect up to one month’s rent to cover the first rental period. Once the tenancy starts, rent is due periodically — landlords cannot contractually require quarterly or termly lump sums.

Tenants can still choose to pay ahead voluntarily after signing, but it cannot be a condition of the tenancy.

The alternatives that actually work

1. Professional guarantor services

The most direct substitute for a personal guarantor is a commercial one. Companies such as RentGuarantor and Housing Hand act as guarantor for a fee paid by the tenant. Costs vary with the rent, but as a guide RentGuarantor starts from around £249 per year (roughly the equivalent of three to four weeks’ rent), while Housing Hand starts from around £36 per month. Both require the tenant to pass their own ID and credit checks, so they are not a blank cheque, but they are accessible to many who cannot find a personal guarantor.

The landlord gets contractual protection comparable to a personal guarantor — RentGuarantor, for example, covers up to 12 months’ rent losses or a maximum of £120,000 per tenancy — with the comfort of a commercial entity rather than a private individual behind the agreement.

2. Council and charity rent guarantee and deposit schemes

Some local authorities run schemes to help tenants access the private rented sector — typically deposit or bond guarantees, and in some cases guaranteed-rent arrangements with the council acting as an intermediary. Sheffield, Oxford, Reading and Waltham Forest all operate schemes of this kind, though the precise structure differs from area to area.

Coverage is patchy and eligibility criteria vary. Provision tends to prioritise households at risk of homelessness, care leavers, and those on low incomes or benefits. Contact your local council’s housing options team to find out what is available in your area. There is no national statutory scheme that makes this consistent — it remains one of the more significant gaps in the current policy landscape.

3. Specialist referencing with risk-adjusted underwriting

A tenant with no UK credit history is not necessarily a high-risk tenant. Thorough tenant referencing that looks at employment contracts, bank statements, rent payment history from overseas, or employer references can build a picture that a binary credit check misses. Landlords and agents willing to invest time in proper referencing — rather than leaning on advance rent as a shortcut — often find that applicants with thin credit files are perfectly reliable tenants.

At PropertyGoose, our referencing process is designed to assess the full picture, not just a credit score. Results typically come back within 48 hours — the actual processing is fast; the wait is almost always applicants completing their own documentation, and our team works seven days a week to turn things around. See how our referencing works or view our pricing.

4. Rent guarantee insurance for the landlord

This is a landlord-side product, not a tenant-side one — but it is worth tenants being aware of it when negotiating with reluctant landlords. Rent guarantee insurance (often from around £100–£300 per tenancy per year, depending on the cover and provider) pays out if rent goes unpaid. If a landlord’s objection to accepting a tenant is financial risk rather than genuine suitability concern, pointing them towards specialist insurance can unblock a stalling application.

Policies generally require the tenant to have passed referencing or to have a guarantor in place, so this works best as a belt-and-braces measure alongside referencing rather than a standalone substitute.

What about existing tenancies?

The advance-rent restrictions bite on tenancy agreements as the new regime takes effect. Where a tenancy was agreed before 1 May 2026 and already included an advance rent arrangement, the NRLA’s guidance indicates you may continue to collect it in advance under those terms until that tenancy comes to an end. When the tenancy is renewed or re-signed under the new rules, the restrictions apply.

What the cap does not fix

Being honest: the rent in advance cap removes a workaround that was bad for tenants but functional for the market. It does not create new supply, it does not lower rents, and it does not conjure guarantors into existence for people who genuinely cannot access them.

Landlords facing more restrictive possession rules under the Renters’ Rights Act — Section 21 ‘no fault’ evictions have now been abolished — may respond by tightening other criteria: stricter affordability ratios, greater reliance on guarantors, or fewer offers to borderline applicants. That is a real risk, and one widely raised during the Bill’s passage.

For agents managing landlord clients through this period, the practical answer is robust referencing upfront, clear documentation of guarantor agreements, and — where a landlord’s risk tolerance is genuinely stretched — exploring whether rent guarantee insurance gives them the comfort they need without pricing good tenants out. Our comparison page sets out how PropertyGoose fits alongside other services in the market.

A note for landlords and letting agents

If you are reviewing your lettings process in light of the Renters’ Rights Act changes, the short checklist is: update your tenancy agreement templates to remove any advance rent clause beyond one month; train front-of-house staff on the new payment sequencing (nothing before both parties sign); review your referencing criteria to ensure you are not inadvertently discriminating against benefit claimants or families with children (now prohibited under the Act); and consider whether rent guarantee insurance or professional guarantor products should be part of your standard offering to applicants who cannot produce a personal guarantor.

The Renters’ Rights Act is not the end of landlord risk management — it is the beginning of doing it properly, rather than using upfront cash as a blunt substitute for due diligence. Book a call if you want to talk through how your referencing workflow should look in the new landscape.

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This article reflects the law as of June 2026 under the Renters’ Rights Act 2025. It is general information only and does not constitute legal advice. If you are unsure how these rules apply to your circumstances, consult a qualified solicitor or housing adviser.

Author: Craig Ryder