The introduction of the Renters’ Rights Act (RRA) on 1 May 2026 has transformed tenancy agreements across England, notably removing fixed terms and establishing periodic tenancies as the default. This shift has brought renewed attention to the role and security of guarantors in rental agreements, particularly concerning how rent increases might inadvertently release guarantors from their obligations. UK landlords and letting agents must now carefully consider the legal nuances surrounding guarantor agreements in this new regulatory landscape.
The enduring principle of contract variation and guarantor liability
The legal foundation for understanding guarantor obligations in the context of tenancy changes traces back to the 1878 Court of Appeal case Holme v Brunskill. This case established what is commonly referred to as the “variation rule,” which holds that if the underlying contract guaranteed is altered without the guarantor’s consent, the guarantor may be discharged from liability—unless the change is minor or clearly does not prejudice them.
For landlords, this principle remains highly relevant. A guarantor’s commitment is tied to a specific set of tenant obligations. If those obligations are modified in a way that increases the guarantor’s risk, such as a rent increase, and the guarantor has not agreed to this change, a court could potentially release them from their guarantee. This risk underscores the importance of understanding how rent adjustments interact with guarantor agreements under current law.
Rent increases under the Renters’ Rights Act and their legal implications
The RRA introduced a statutory framework for rent increases on assured periodic tenancies, replacing previous contractual rent review clauses. Landlords must now serve a Section 13 notice on a prescribed form to propose a rent increase, which can only be done once annually with at least two months’ notice before the new rent takes effect. This statutory process is designed to standardise rent adjustments and provide clear protections for tenants.
However, this statutory mechanism raises complex questions about whether a rent increase under Section 13 constitutes a contractual variation that could discharge a guarantor under the variation rule. Since the increase is imposed by law rather than mutual agreement, it may not be considered a variation in the traditional sense. This issue remains legally untested in the context of the RRA, leaving some uncertainty for landlords regarding guarantor liability following a rent increase.
The critical role of guarantee wording and consumer protection
Whether a guarantor remains liable after a rent increase or the transition to a periodic tenancy largely depends on the specific wording of the guarantee document. Well-drafted guarantees often include clauses that prevent discharge by consent to variations, explicitly stating that the guarantor’s obligations continue despite changes to the tenancy terms or rent. These provisions aim to protect landlords from losing guarantor support when tenancy terms evolve.
Nonetheless, such clauses are interpreted strictly against the landlord under the contra proferentem rule, and courts may limit their scope if the changes exceed what the guarantor originally contemplated. Additionally, if the guarantor is a private individual acting as a consumer, the Consumer Rights Act 2015 requires courts to assess the fairness of contract terms. Provisions that impose open-ended, escalating liabilities without exit options may be scrutinised and potentially deemed unfair, further complicating guarantor enforcement.
Practical steps for landlords managing guarantor agreements
Despite these complexities, guarantees remain valuable tools for landlords, provided the documentation and management practices are robust. Landlords should review existing guarantees to confirm they explicitly cover periodic tenancies and rent increases. Maintaining a clear paper trail—including the original guarantee deed, any information provided to the guarantor, and copies of tenancy agreements—is essential to demonstrate the guarantor’s informed consent to changes.
When serving a rent increase under Section 13, landlords are advised to notify guarantors in writing and retain evidence of this communication. This practice can help mitigate disputes about whether the guarantor consented to the variation and strengthen the landlord’s position if enforcement becomes necessary.
What this means for landlords
The transition to periodic tenancies and the statutory rent increase process under the RRA have introduced new considerations for landlords relying on guarantors. While the law is not yet settled on whether statutory rent increases discharge guarantors, landlords should treat the issue cautiously and proactively manage their guarantor arrangements.
Ensuring that guarantee documents are carefully drafted and that communication with guarantors is thorough and documented will be increasingly important. Landlords may face challenges enforcing guarantees if they cannot clearly demonstrate that guarantors were made aware of and accepted changes to tenancy terms, including rent increases. Seeking legal advice tailored to individual circumstances remains advisable.
What TLA members should consider
- Review all existing guarantor agreements to verify they explicitly cover periodic tenancies and rent increases.
- Ensure guarantee clauses include clear consent to variations or anti-discharge provisions, understanding their limitations under current legal principles.
- Maintain comprehensive records of all guarantor documents, tenant agreements, and communications, particularly when serving rent increase notices.
- Notify guarantors in writing whenever a rent increase is served under Section 13 and keep proof of this notification.
- Consult with legal professionals experienced in landlord-tenant law to assess the strength of guarantees and compliance with the Renters’ Rights Act.
- Consider using digital tools or platforms that securely store and timestamp guarantor documents and communications to support evidence in potential disputes.
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