Why Is a Guarantor Company Necessary?

Why Is a Guarantor Company Necessary When Renting in Japan?

In Japan, most rental apartments require tenants to use a rent guarantor company (家賃保証会社).
For many foreigners, this system is unfamiliar, but in Japan, it is now standard practice.

Instead of relying only on a personal guarantor, landlords use guarantor companies to manage rental risk and ensure stable rent payments.

What Does a Guarantor Company Do?

If a tenant fails to pay rent, the guarantor company will temporarily pay the rent to the landlord or management company.

This does not mean the rent is forgiven.
The tenant is still fully responsible for paying the guarantor company later.

Why Do Landlords Require a Guarantor Company?

From the landlord’s point of view, a guarantor company provides:

• Stable and predictable rent payments

• Reduced risk of unpaid rent

• Easier rent management and dispute handling

Because of this, many landlords prefer guarantor companies over personal guarantors, and some properties require both.

Do I Still Need a Guarantor Company If I Have a Personal Guarantor?

In most cases, yes.

Whether a guarantor company is required is decided by:

• The landlord, or

• The property management company

If the property requires a guarantor company, it is not optional, even if you can prepare a personal guarantor.
In addition, the guarantor company is usually pre-designated, and tenants cannot choose freely.

Is a Guarantor Company Basically Mandatory in Japan?

Yes. Today, guarantor companies are required in almost all rental properties.

Over the years, the number of properties requiring a guarantor company has increased significantly.
As of recent years, the vast majority of rental apartments nationwide require one.

Especially in major cities like Tokyo, it is safe to assume that a guarantor company will be required for almost every rental apartment.

Is This a Disadvantage for Tenants?

Not necessarily.

While it adds an extra fee at the beginning, it also:

• Allows people to rent without a personal guarantor

• Makes renting more accessible for foreigners

• Helps landlords feel comfortable accepting international tenants

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For better or worse, guarantor companies are now a normal and unavoidable part of renting in Japan.
Understanding this system will make your apartment search much smoother.