In general rental contracts, a "guarantor" is essential. If you cannot find someone to act as a guarantor for you, you may consult with your real estate agent to introduce you to a surety company (a guarantor company). Some real estate agents or landlords recommend or require that new tenants use the services of a surety company, even if the tenant already has a guarantor. This is because they are concerned about the financial viability of the guarantor under the current uncertain economic situation.

Basically, a surety company is an agent that plays the role of guarantor for a tenant. They are often credit card companies, etc. When the tenant fails to pay the rent, the surety company will pay the rent to the property managing agent on behalf of the tenant and in turn will demand payment from the tenant. However, each surety company has different guarantee policies and screening criteria. It is important to carefully check them beforehand.

There are two types of guarantors, one of which is a simple "guarantor" and the other of which is a "joint guarantor." For rental contracts, a joint guarantor is more common. Whereas a guarantor may be required to act only when the tenant (contract signer) is in dire trouble paying the rent, a joint guarantor shares equal liability with the tenant (contract signer) in paying the rent. This guarantor system is not very common outside of Japan and the joint guarantor system in particular seems unique to Japan. Foreign residents living in Japan may have difficulty understanding this system.

As a result of the increasing unemployment rate, there are many cases where even Japanese are having trouble finding guarantors. For that reason, the popularity of using a surety company for rental housing has been rapidly increasing. It is also true that there have been a number of problems related to surety companies. It is quite possible that companies found on ads posted on street corners turn out to be unscrupulous operators that charge enormous contract fees. Be sure to ask a real estate agent that you trust to introduce you to a surety company. Also be reminded, however, that the contract is a direct contract between the tenant and the surety company.

Contract terms and guarantor fees also differ depending on the surety company. You should find a company that meets the requirements of your specific rental contract.

Finally, it is important to keep in mind that while it is easy and convenient to use this guarantee system, if you fail to pay the rent, it can severely affect your credit.