MSE News: Rent payments to go on your credit file

JimmyTheWig

jjlandlord wrote: »

Again, how would they benefit?

Good tenant and bad tenant both go for a flat at the same time. Currently good tenant has 50:50 chance of getting it. With the new scheme they would almost definitely get it. Hence they benefit.
Alternatively, good tenant can now make an offer under the advertised rent level and given that their credit report will show that they have paid their rent on time previously the landlord may be more willing to accept. Hence they benefit.

By having some of their competition being marked as bad, this surely gives a good tenant an edge?

tbs624

Thrugelmir wrote: »

Those with the most to lose have something to hide....

yawn ..please spare us from this tired old chestnut that gets trotted out every time there are justifiable objections to the growth of our database nation.

ruggedtoast

chattychappy wrote: »

I think it's a good thing.

I have a friend who is a LL. Some tenants seem to make an industry of not paying and it's a real hassle to get them out, even under the so-called "accelerated procedure". References are pretty useless.

He has no problem with "can't payers" and indeed most of his tenants are fine. It's the won't payers who are the problem. They seem to know their rights very well and exploit to the full. By the time he can get them out, he is left with arrears that will never be recovered.

Not surprising there are so many dodgy landlords out there - he's had enough and is getting out. No doubt a less decent bloke will fill the gap.

I have a friend who is a tenant. Some landlords seem to make an industry out of not paying for repairs, intruding on privacy, and inventing spurious reasons to withhold deposits. Even under the so-called "Deposit Protection Scheme". The assurances they give are useless.

He has no problem with "can't payers", it's the won't payers who are the problem. They seem to know their rights very well and exploit to the full. By the time he can get them to take action, he is left with months of stress and often out of pocket himself. Costs that will never be recovered.

He's had enough and is putting all his savings into a deposit for a mortgage. Not surprising there are so many dodgy tenants out there, considering how many of them are treated.

millym

tbs624 wrote: »

Your indignation on behalf of your "friend" is heart warming.

However, Ts such as the ones you describe (who are, let's remember, a minority) usually end up with CCJs against their name which...erm...already come up in current referencing procedures. Your mate has 6 years in which to pursue those arrears via the courts.

On your comment about references being "pretty useless", do bear in mind that a T can have been paying everything on time for years and have a smiley face sticker or three on his records at Experian - that is no guarantee that all will be well for future lets, any more than any other sort of referencing.

Whenever there is any proposed expansion of databases/creations of new ones and further opportunities for data creep then the commercial firms/government or whoever will try to flog it as beneficial for all/for the majority.

The usual pattern is that advance notice is given via the media and the level of opposition/approval gets measured. The marketing boys and girls can then adjust their "education" campaigns accordingly.

The vast majority of Ts can already clearly show, on request, whether or not they meet their tenancy payments on time.

tbs, you've hit the nail on the head here re data creep. I too feel very uncomfortable about it all. I think there are already plenty of checks in place for tenants before being granted a tenancy.

I, for instance, could provide bank statements going back 20 years to a prospective LL, which would provide much more detailed financial info than any credit report. (That reminds me, must dig my shredder out...:rotfl:).

MissMoneypenny

MissMoneypenny wrote: »

Thinking on, hasn't Experian already set up a few schemes recently to find the landlords without consent to let; the Moving Alert for lenders and it also runs National Hunter for lenders, too. Anyone want to take bets that they don't somehow link this new scheme of late payments to landlords too, in the not too distant future?

Ok...I worked it out.

• Experian wants a list of all rented properties. This will complement the anti fraud systems they already operate for lenders; National Hunter and Mover Alert.
• They then sell a check on this new list of rental properties to lenders, who can then find which borrowers are renting without consent.
• HMRC can use the rental properties list to see who is evading taxes.
• HMRC can use that list to see which benefit claiments (of the benefits Child Tax Credits & Working Tax Credits) aren't declaring their income from their rental on their Tax Credit welfare claim form. Or are over the capital limit of 6k and up to 16K, if they are claiming income based welfare payments.
• Next year, Universal Credits replaces most income based welfare payments and the anomoly of the income based welfare payments Tax Credits, not having a capital limits, will be rectified. Tax Credits goes, and becomes part of the new Universal Credit and UC has capital limits. Capital in houses claimants don't live in, savings, etc. will stop many exisiting claimants from claiming the new Universal Credit. It will be so easy for the welfare departments to check savings and rented out property now and see who is/has been, committing benefit fraud.

From a tenants point of view, I can't see how this is a bad thing if they are the ones who pay on time.

• It will stop cash in hand rental payments.
• Give them greater choice of the better properties/landlords.
• Should stop the practice of having to sign joint tenancy agreements. Common law I assume at some point.
• Catch the landlords letting without consent (and hence their insurance is invalid).
• Boost their credit rating.
• Increase their chances of getting a higher LTV mortgage.
• Remind then to take legal cover with their house contents policy and ensure that policy doesn't exclude legal action against a landlord.

Edit: if a tenant loses their job and LHA takes over the rent, then that payment will be late and affect their rent payments if they don't have any savings. Although not as bad a landlord losing their job or getting sick, as many won't be able to claim income based benefits from 2013.

tbs624

JimmyTheWig wrote: »

Good tenant and bad tenant both go for a flat at the same time. Currently good tenant has 50:50 chance of getting it. With the new scheme they would almost definitely get it. Hence they benefit.
Alternatively, good tenant can now make an offer under the advertised rent level and given that their credit report will show that they have paid their rent on time previously the landlord may be more willing to accept. Hence they benefit.

By having some of their competition being marked as bad, this surely gives a good tenant an edge?

(1)Let's remember that this proposed new addition to the battery of extensive checks that are already undertaken will be charged by the LL/LA to the T.

(2) LLs can already check up on whether or not a potential T currently pays on time (and/or has done in the past) and whether s/he has CCJs etc .

(3) Why should a LL reduce his rent for a potential new T because any records show him/her to have previously met their obligations? It just does not work like that unless you have a property which is hard to let and you are likely to suffer a void. LL may in fact have 7 "good" Ts after the property and 3 less suitable applicants.

By having some of their competition being marked as bad, this surely gives a good tenant an edge?

The fish has swallowed the hook...........

jjlandlord

JimmyTheWig wrote: »

Good tenant and bad tenant both go for a flat at the same time. Currently good tenant has 50:50 chance of getting it. With the new scheme they would almost definitely get it. Hence they benefit.

You assume that currently landlords have no way whatsoever to check who's probably a good or bad tenant, which is not the case.

You also ignore the risk to all tenants of having erroneous data input on their credit file by letting agents or landlords...
Even without erroneous data, could being a few days late on rent payment once impact the credit record for years?


So, again, how would it benefit tenants?

Swampmonster

I really don't think this is a good idea at all.

Both myself and my Husband have been made Bankrupt at seperate times in the last few years. We are both now discharged and neither has got and have no desire to get credit ever again. So as it stands at the moment are credit rating is not really of any concern.

However when this is introduced if we needed to move house (rented) we would have extreme problems getting a new rental agreement as Bankruptcy remains on your credit file for six years.

I'm begging the Government not to do this especially as we are in such difficult times at the moment. We would be judged by past mistakes, financially linked to problematic ex's and flatmates and penalised if you have a change of circumstances that forces you to claim Housing Benefit/LHA and the long processing claim time means you are late with the rent.

MissMoneypenny

jjlandlord wrote: »

You also ignore the risk to all tenants of having erroneous data input on their credit file by letting agents or landlords...

That's where having legal cover on contents insurance comes in (ensuring that legal action against a landlord isn't excluded on the policy) as they could then sue the landlord and letting agent.

jjlandlord wrote: »

So, again, how would it benefit tenants?

Damages claims awarded against erroneous data on credit files from LAs and LLs would boost the tenants savings. That's a benefit.

Tenants' would actively seach for the useless LAs and LLs, instead of trying to avoid them!;) Something else for Experian to make a list of and then sell to the tenants.

tbs624

HAMISH_MCTAVISH wrote: »

No chance for ordinary flat/house shares. Landlords are renting the property as a whole, and expect to get paid the whole rent regardless of whether a flatmate moves out.

MissMoneypenny wrote:

That will need amending under the Housing Acts to make that illegal; if this plan goes ahead. The government is going to end up with a lot of people wanting them to house them otherwise and the welfare state is already breaking under the strain

The Government will not want to risk upsetting PRS LLs by removing the J&SL tenancy.