Guarantee of unpaid rents and rental deposit: what are the differences?
Unlike the rental deposit, the Guarantee of Unpaid Rents (GLI) directly reimburses the owner in the event of unpaid rents. The GLI is therefore more reassuring for the owner than the rental deposit. In certain cases, the joint and several guarantee, drawn up in due form and annexed to the lease, may nevertheless be sufficient to protect the non-occupying owner in the event of default by the tenant. If the owner has a large loan for which he must repay the monthly payments, the Unpaid Rent Guarantee is however to be preferred because it will further secure his budget balance. Indeed, with a rental deposit, the reimbursement procedure is generally longer and more complex. If the tenant does not pay his rent, the landlord must contact not only him but also his guarantor. In the absence of a response from the tenant and / or his guarantor, the owner must initiate, at his expense, legal proceedings to recover the amount of unpaid bills.
If the owner falls under the real scheme, the amount of the GLI premiums is deductible from the rental income.
Unpaid rent insurance: how to make the right choice?
Preferably, the Unpaid Rent Guarantee (GLI) must be taken out before entering the tenant's premises or at the latest 15 days after signing the lease and handing over the keys. To choose the right insurance, it is preferable to ask for quotes from several establishments in order to compare the prices and the conditions offered. The differences between two contracts mainly concern the compensation ceilings and conditions (waiting periods before performance of guarantees, compensation ceilings, franchise amounts, etc.). It should be noted that by contacting the insurer with which he has taken out his comprehensive home insurance or non-occupant owner's insurance, the owner will most of the time be able to take advantage of advantageous conditions. Indeed, insurance companies generally offer discounts to customers subscribing to several policies within their establishment. The owner also has the option of entrusting the rental management of his property to a real estate agency which offers a collective contract to insure himself against unpaid rents. In this case, it is then up to the agency itself to verify the tenant's eligibility for the Unpaid Rent Guarantee.
Depending on the insurance companies, the degrees of protection and the conditions of application may vary.
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