Renting with bad credit history

carriel_2 · 10 October 2006 at 12:32PM

Can I ask for peoples experiences on this one or any information you can offer?

We're about to put our house on the market & have decided we would prefer to rent for 2 years while we decide whether the area we choose is defintaly for us.

We will have a large amount of equity from the sale of our house which will be put in a ISA or similar once we sell to use as a deposit when we decide we want to buy again.

We do have debts & have defaulted on a couple, we are in a DMP & are paying them as much as we can at the moment, but obviously as soon as the house is sold, they will all be paid off.

I've been looking at a few houses this morning & they all ask for credit searches, references etc, now our credit search will not be good :eek:

Do you think it will be a problem for us to rent? We've never missed a mortgage payment in 10 years, so hopefully this will be seen as a good thing! We are also willing to offer 6 months or even a years worth of rent in advance to secure the right house.

Any thoughts?

westernpromise · 10 October 2006 at 1:56PM

carriel wrote:

We are also willing to offer 6 months or even a years worth of rent in advance to secure the right house.

Any thoughts?

I wouldn't do that. What if the landlord stops paying the mortgage? He gets repossessed, you get evicted and you'd have to get your money back off him.

whambamboo · 10 October 2006 at 1:59PM

carriel wrote:

Can I ask for peoples experiences on this one or any information you can offer?

We're about to put our house on the market & have decided we would prefer to rent for 2 years while we decide whether the area we choose is defintaly for us.

We will have a large amount of equity from the sale of our house which will be put in a ISA or similar once we sell to use as a deposit when we decide we want to buy again.

We do have debts & have defaulted on a couple, we are in a DMP & are paying them as much as we can at the moment, but obviously as soon as the house is sold, they will all be paid off.

I've been looking at a few houses this morning & they all ask for credit searches, references etc, now our credit search will not be good :eek:

Do you think it will be a problem for us to rent? We've never missed a mortgage payment in 10 years, so hopefully this will be seen as a good thing! We are also willing to offer 6 months or even a years worth of rent in advance to secure the right house.

Any thoughts?

Lots of agents don't bother credit checking. You could always go with a private landlord.

kirstles77 · 10 October 2006 at 2:12PM

Me and my partner both have defaults on our credit history, but we rent through a private landlady. She didn't ask for a credit check - only character references.

silvercar · 10 October 2006 at 2:31PM

for a landlord the problem will be that they won't be able to rent insurance without credit checking you.

I would consider you if you paid 6 months rent up front, otherwise not. Sorry.

carriel_2 · 10 October 2006 at 2:57PM

Thank you for the feedback & its good to hear a landlords point of view.

I know we arent a risk, but I can understand a landlord thinking twice about renting to someone with a bad credit history, I know if it were me, it would cause me concern.

I'm glad that the offer of advance rent would be something a landlord would consider, makes me feel a lot happier about it all. I've since spoken to an agent too & she said that alot of people receive bad credit searches, & that an offer of advance rent really helps.:money:

silvercar · 10 October 2006 at 3:11PM

There are a lot of people with debt problems in this country.

There are a lot of people not in a position to own property.

These two groups have an overlap. If no landlord would consider anyone with a bad credit rating there would be a lot of homeless people around. On the other hand landlords need to protect themselves or they wouldn't be in business.

Being prepared to pay a large deposit and/ or rental up front will show a landlord good intent.

I give my tenant a copy of the buildings insurance. This means they know that, not only the building is insured, but that the mortgage company is aware the property is rented out. (As mortgage companies require notification of the building insurance.) This means the tenant is secure in knowing that, if there was a mortgage problem, the mortgage company would be aware there was a tenant to consider.

clutton_2 · 10 October 2006 at 5:09PM

i would be impressed with the honesty you have shown here, and if you came to me with your mortgage payment records, and bank statements for several months, and the offer of rent in advance, i would offer you a tenancy - after checking out with your current employers. good luck with your search.

real1314 · 10 October 2006 at 9:14PM

I'd agree with the 2 previous posts, an honest declaration, an offer of double deposit and say rent payable 3 months in advance?
Definitely a good idea to take your mortgage statements to show your ability to pay / budget.

James_Robertson · 11 October 2006 at 1:17PM

Why are you renting?

If you have equity in your house, get a mortgage!!
Mortgage Brokers will fall over themselves to lend to you if you have a good deposit (25% or more)

When you come up against greedy landlords, they want to cover themselves, credit checks, references, large deposits. Why bother???
Just buy, you are paying someones mortgage anyway

James

whambamboo · 11 October 2006 at 1:55PM

Oh dear.

James_Robertson wrote:

Why are you renting?

If you have equity in your house, get a mortgage!!

Why?

Renting is often cheaper, is more flexible, and it doesn't cost thousands of pounds in lost money like buying and selling after 2 years would do.

And when prices have tripled in 10 years, would you say it's impossible for them to fall, or that they will triple again?

Just buy, you are paying someones mortgage anyway

If you have £200,000 invested and you earn £10,000/year from it, but then use it buy a house, how much money do you earn from your house?

The answer is zero

So if you are paying less than £10,000 a year in rent, then you are better off by not buying, aren't you?

Owning a property is not free, because you either pay interest on a mortgage (which costs money, just as rent does), or you lose interest/income on sinking the money into the house.

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Renting with bad credit history

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