Joint Guarantor vs. Guarantor Company: Market Rates for Guarantee Fees and How to Spot Illegal Screening

What Is "Guarantee" in a Rental Contract?

When entering into a rental contract, a "guarantee" is required to secure the tenant's ability to pay rent. In the past, it was standard to appoint a relative as a joint guarantor, but today, using a guarantor company (rental guarantor company) has become the norm. This article clarifies the differences between joint guarantors and guarantor companies, explains market rates for guarantee fees, and outlines important points about the screening process.

Differences Between Joint Guarantors and Guarantor Companies

How Joint Guarantors Work

A joint guarantor is a person who assumes equal responsibility to the tenant for paying rent and damages if the tenant (resident) is unable to pay rent.

Typical Requirements for a Joint Guarantor

• •Resident adult living within Japan (minors not permitted)
• •Stable income (employment or civil service preferred)
• •Annual income of approximately 36–48 months' worth of rent
• •Blood relative or in-law within three degrees of kinship to the tenant (some properties allow friends or acquaintances)

Following the 2020 reform of the Civil Code, individual joint guarantor contracts must now explicitly state the "maximum guarantee amount (cap on guaranteed liability)" in the contract. Joint guarantor contracts lacking this specification are invalid, so verifying your contract is essential. For more details, see also our Complete Guide to Rental Contract Checkpoints.

Risks of Being a Joint Guarantor

A joint guarantor faces direct claims from the landlord if the tenant fails to pay rent. Liability can extend to multiple months of unpaid rent and damage repair costs, so anyone considering becoming a joint guarantor should fully understand these risks.

How Guarantor Companies Work

A guarantor company (rental guarantor company) temporarily advances rent payment on behalf of the tenant. If the tenant defaults, the company pays the landlord directly and later bills the tenant.

Benefits of Using a Guarantor Company (for the Tenant)

• •No joint guarantor needed (or joint guarantor requirements are relaxed)
• •Easier to qualify for a contract if you live alone or have distant family ties
• •Some guarantor companies accept foreign nationals

Drawbacks of Using a Guarantor Company (for the Tenant)

• •You must pay an initial guarantee fee of 0.5–1 month's rent
• •Annual (or biennial) renewal fees apply
• •There is a screening process, and you may not be approved

Market Rates for Guarantee Fees

Guarantee fees vary significantly by company and plan. As of 2026, typical rates are as follows:

Credit-based guarantor companies (such as Orico, Jaccs, and Aplus) assess your creditworthiness based on credit card payment history, resulting in lower fees. However, past credit defaults or delinquencies may result in rejection.

Can You Negotiate Guarantee Fees?

If the guarantor company is designated by the property management company, fee changes are generally not possible. However, if multiple company plans are offered, you may be able to choose a more affordable option. It's worth asking the property management company if other plans are available.

What to Do If You Fail Screening

If a guarantor company rejects your application, consider the following options:

1. Look for Properties That Work with Different Guarantor Companies

If you're rejected by a credit-based guarantor company, independent guarantor companies (such as All-Guarantee or Japan Rental Guarantee) use their own criteria and may approve you. The reverse is also true—an independent company may reject you while a credit-based company approves you. Foreign nationals should also see How to Rent Without a Guarantor.

2. Strengthen Your Income Documentation

If rejection is due to insufficient income, submitting additional documents such as an employment contract, job offer letter, or proof of expected salary increases may help you pass screening.

3. Clarify Your Emergency Contact

Providing a clear emergency contact (family member or relative) with accurate information boosts your application's credibility. Note that an emergency contact is not a guarantor and has no financial responsibility.

Countering Illegal or Improper Screening

Improper rejection of applicants based on nationality, age, or welfare status is a documented problem.

Examples of Screening Denials That May Be Illegal

• •Blanket denial based on foreign nationality: Discrimination based on nationality is problematic toward people requiring housing support.
• •Denial of welfare recipients: Welfare benefits are a legitimate source of income, and blanket rejection on this basis is improper.
• •Denial based on disability: Such actions may violate the intent of the Act on the Elimination of Discrimination Against Persons with Disabilities.

How to Respond

If you face improper screening denial, contact:

• •Ministry of Land, Infrastructure, Transport and Tourism Housing Consultation Hotline (0570-040-777)
• •Legal Affairs Bureau / Human Rights Consultation: Available for consultation regarding discriminatory treatment based on nationality or disability
• •Housing Support Council for Persons with Housing Insecurity: Established in each prefecture to provide individual consultation

"Housing support organizations" (designated by each prefecture) assist foreign nationals, elderly individuals, and welfare recipients in securing rental contracts. If you're having difficulty with screening, consulting these support organizations is an effective option.

Summary

Joint guarantors and guarantor companies operate under different systems with different costs, and the best choice depends on your situation. Understanding the fee market (30–100% of monthly rent upfront, ¥5,000+ annually for renewal) and comparing multiple plans is key to keeping costs down. If you fail screening, consider using different guarantor companies or support organizations. If you face improper rejection, actively use the consultation services available to you.