Jump to content
House Price Crash Forum
Saving For a Space Ship

 New parliamentary bid to have rent records added to credit ratings

Recommended Posts

 New parliamentary bid to have rent records added to credit ratings

https://www.lettingagenttoday.co.uk/breaking-news/2017/11/new-parliamentary-bid-to-have-rent-records-added-to-credit-assessments

Quote

Lord John Bird, the founder of Big Issue, is tomorrow launching his own Bill in the House of Lords in a bid to have rental records included amongst the criteria used to assess people’s creditworthiness.

Bird - a cross-bench peer - says the rental payments of the UK’s 11m private and social renters are not recorded and so do not count towards, for example, an individual’s application to secure a mortgage. 

It means many of the country’s least well-off tenants may be obliged - despite excellent rental payment records - to have repayment contracts on hire purchase schemes which are more expensive than those offered to owner occupiers. 

“If you are a rent payer, even if you pay your rent on time for many years, it won’t necessarily get the credit file that you would if you were paying a mortgage. So we’re trying to help reliable rent-payers get the same advantages as reliable mortgage payers” says Lord Bird.

At present, credit rating agencies do not routinely include rent payment history when calculating credit scores. This means a tenant can find it difficult to access a mortgage, even if they have a long history of rent being paid in full and on time

This follows the success of an online petition, signed by 147,307 people, saying: "paying rent on time [should] be recognised as evidence that mortgage repayments can be met".

The idea already has the backing of the Residential Landlords Association; it surveyed almost 3,000 landlords with 61 per cent of respondents supporting such a move.

Including rent payment would also support landlords, the RLA says, providing them with a more accurate assessment of a prospective tenant’s credit and rent payment history....

 

Share this post


Link to post
Share on other sites

Since rents are paid in advance & not on credit, there is no good reason to include them in a credit file. Bank deposits don't figure either, just your level of indebititness, only rent arrears would fall into this category. Bank statements or a rent book will show that rent is paid in a timely manner.

Edited by Fatmanfilms

Share this post


Link to post
Share on other sites

Clever guy, Bird.

But the decent thing that was Big Issue was pretty much destroyed by tax credits and the self-employment nonsense.  (Though, thankfully, this seems to have been resolved in the last 6 months -- seen a drop in Big Issue sellers over the summer?  But it still hasn't really had a chance to return to its previous supportive role)

I'm sure that the government and banks will ensure that this idea, also, will  be turned into something to be taken advantage of.

Share this post


Link to post
Share on other sites
33 minutes ago, Saving For a Space Ship said:

From comments ..

Quote

Be careful what you wish for. Letting Agents will use this information to assess the credit worthiness of new tenants. Where will the poor payers live? 
What stops financial institutions contact the Agent/Landlord now? 
Getting refused for a credit card for a poor credit history is not really that important but finding somewhere to live with poor payment record is only going to cause more difficulties. 
What about wife’s who find themselves left with the children when the husband runs off and has to wait six weeks or more for her claim, 
People made unemployed when companies cease trading. There are lots of examples where genuine cases will suffer or do you suggest we massage their payment records

 

Share this post


Link to post
Share on other sites

It's an excellent idea. Paying rent on time and in full is the fulfillment of a payer's legal obligation (the rental agreement) and should be recognised as such when it comes to other credit/financial arrangements. Those who slack off on paying their rent quite rightly should be judged accordingly, as they would do if they slacked off on paying council tax, utility bills, loans, fees, etc (all of which form part of a person's credit profile). It matters not whether they're on housing benefit -- if the housing benefit that goes into their pockets doesn't quite make it back out of the pockets to pay the rent, of course they should have a red flag stuck in their rating. You can't let the exceptions ('what about someone who didn't get their housing benefit cheque for 6 weeks?') scrap everyone else's chances.

Share this post


Link to post
Share on other sites

I know someone who lives in another country and wants to evict their tenants to sell their house.  IIRC the tenants have stopped paying.

Adding rental records to credit records in this case would help the landlord not the tenant.

BTW I am not saying who is in the right, because I can see both sides.

Of course if we didn't have a dysfunctional housing market and low interest rates people going abroad, would just sell their house and stick the money in the bank.

As a friend did in the 1980s.

Edited by iamnumerate

Share this post


Link to post
Share on other sites
4 hours ago, dgul said:

Clever guy, Bird.

But the decent thing that was Big Issue was pretty much destroyed by tax credits and the self-employment nonsense.  (Though, thankfully, this seems to have been resolved in the last 6 months -- seen a drop in Big Issue sellers over the summer?  But it still hasn't really had a chance to return to its previous supportive role)

I'm sure that the government and banks will ensure that this idea, also, will  be turned into something to be taken advantage of.

What happened with this ?

Share this post


Link to post
Share on other sites
20 minutes ago, Monkey said:

So to do this wouldnt the Letting agent or Landlord have to be vetted by the FCA and other onerous orgsnisation for data protection?

 

Ideally a government agency would be setup to administer rent payments. ALL rent payments have to go through them by law.

This would have additional bonuses of eliminating tax avoidance.

Oh and landlords pay for it.

Edited by honkydonkey

Share this post


Link to post
Share on other sites

I really wouldn't trust any of the agencies I have been through to in any way provide regular accurate payment information. Many have difficulty answering a phone or replying to an email.

At a high level the logic sounds reasonable though.

Share this post


Link to post
Share on other sites
5 hours ago, dgul said:

Clever guy, Bird.

But the decent thing that was Big Issue was pretty much destroyed by tax credits and the self-employment nonsense.  (Though, thankfully, this seems to have been resolved in the last 6 months -- seen a drop in Big Issue sellers over the summer?  But it still hasn't really had a chance to return to its previous supportive role)

I'm sure that the government and banks will ensure that this idea, also, will  be turned into something to be taken advantage of.

Roma.

There's a Roma families at my partner's school.

The mother tries to sell Big Issues when she's picking up her kids.

The Roma gangster will have got rid of most of the non Roma Big Issues sellers.

If you are buying a Big Issue of a Roma seller then you are directly supporting both the abuse of the UK benefit system and various child slavery, prostitution and drug smuggling.

 

Share this post


Link to post
Share on other sites
1 hour ago, ccc said:

What happened with this ?

There was a test case where the judge said that a Romanian Big Issue seller wasn't eligible for TCs as she wasn't really working / was no-where near being able to support her family with her self-employment (and, I guess, that there was no way this was going to change -- she couldn't say that her business was in the early stages and she'd double turnover next year).

IIRC the numbers were £50 a week self employment, to get £150 a week TCs.

It was May this year.  

Certainly, I've not seen the foreign Big Issue sellers in town this last summer, and I'm not sure I've seen any Big Issue sellers recently...

[I actually approve of this sort of ruling.  IMO you should have a little time to prove your business (6 months, say), but, if you're not earning minimum wage in your stated hours by that point then you shouldn't be classed as self-employed for TC purposes -- that would need to be classed as a scam just to get TCs]

Edited by dgul

Share this post


Link to post
Share on other sites

I see. Walked past three usual ones in central Edinburgh today. No impact on them it seems.

There could be less than previously thought. I don't count so ****** knows.

It's been known as a total scam for years. Article in a paper about it long time ago.

 

 

Share this post


Link to post
Share on other sites
3 minutes ago, ccc said:

I see. Walked past three usual ones in central Edinburgh today. No impact on them it seems.

There could be less than previously thought. I don't count so ****** knows.

It's been known as a total scam for years. Article in a paper about it long time ago.

 

 

Maybe Scot's law is different -- perhaps all the English ones have migrated north.

Share this post


Link to post
Share on other sites
3 minutes ago, dgul said:

Maybe Scot's law is different -- perhaps all the English ones have migrated north.

Fantastic. 

Share this post


Link to post
Share on other sites
4 hours ago, MonkeyPuzzle said:

It's an excellent idea. Paying rent on time and in full is the fulfillment of a payer's legal obligation (the rental agreement) and should be recognised as such when it comes to other credit/financial arrangements. Those who slack off on paying their rent quite rightly should be judged accordingly, as they would do if they slacked off on paying council tax, utility bills, loans, fees, etc (all of which form part of a person's credit profile). It matters not whether they're on housing benefit -- if the housing benefit that goes into their pockets doesn't quite make it back out of the pockets to pay the rent, of course they should have a red flag stuck in their rating. You can't let the exceptions ('what about someone who didn't get their housing benefit cheque for 6 weeks?') scrap everyone else's chances.

Yeah but you're self-admittedly looking in this market for properties to buy and rent out. :rolleyes:

'Nothings stacking up yet'.

It should be the landlords risk imo.

Edited by Venger

Share this post


Link to post
Share on other sites
27 minutes ago, iamnumerate said:

There is no pension but if you are 16 it could be attractive compared to studying etc.

Well the jury is still out whether a pension is going to be worth anything in the future. non contributory is probably best.  not that she will need one a lifetime of free money is guaranteed for people like that. 

Share this post


Link to post
Share on other sites
4 minutes ago, longgone said:

Well the jury is still out whether a pension is going to be worth anything in the future. non contributory is probably best.  not that she will need one a lifetime of free money is guaranteed for people like that. 

If we didn't give people free money for not working we would be able to afford pensions.

Share this post


Link to post
Share on other sites
Guest
19 hours ago, honkydonkey said:

Ideally a government agency would be setup to administer rent payments. ALL rent payments have to go through them by law.

This would have additional bonuses of eliminating tax avoidance.

Oh and landlords pay for it.

How else could this work in practice? They can't give millions of landlords, or even thousands of letting agents, read access to everyone's credit files for so many reasons - let alone write access!

edit: I suppose that a landlord can get partial read access to someone's credit record, from a 3rd party, with their permission already: http://www.experian.co.uk/consumer/questions/askjames344.html - but they couldn't be given write access - some would give black marks wrongly out of spite or incompetence. There's also no official credit ratings agency - which one of the 3 private operators would be chosen, and how? Would they have to establish a new ratings agency?

Edited by Guest

Share this post


Link to post
Share on other sites
17 minutes ago, TheCountOfNowhere said:

Just had a thought...would this help bankers/estate agents see how much they can lend you based on monthly payments :rolleyes:

more than likely, probably greases the wheels to allow a mortgage to be taken out. not so much the amount. 

more Indirect HELP. 

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 407 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.