MSE News: Rent payments to go on your credit file

Experian_company_representative

Heliflyguy wrote: »

If "Rent data will not be part of our credit account sharing scheme (CAIS) - it is a separate ring-fenced dataset" then how will it be "providing a shot in the arm for many people's credit histories, particularly those with thin credit reports." except for the purpose of renting.

If you check your credit report you will see that the credit account section (CAIS on Experian) is just one of several sections that make up your report. Others include Electoral roll, Public financial records, Address links, Previous searches and so on. Rent data will simply be a new section, for people who have some. It will then, with the tenant's permisson, be available to lenders to support their credit rating.

James Jones

nottoolate

Experian_company_representative wrote: »

We will work with the providers on data quality measures, as we do with mainstream lenders.

considering the current "quality" measures you and creditors apply are p|ss poor, that dosnt really fill me with confidence. :rotfl:

Callie22

Experian_company_representative wrote: »

But that's the thing - it'll much be much easier and quicker for agents and landlords to establish that someone is a reliable tenant, probably cheaper for them too. So it should really improve the tenancy application process for people. I suspect it will make it cheaper too.

James Jones

You're hopeful ...

It's already common round my way for letting agents to charge a fee to tenants to protect their deposit, which is usually £30 to £50 - even when they're using the DPS, which is 'free'. If there are any savings I can pretty much guarantee you that they will not be passed on to the tenant, and any added complexity will simply be used an excuse to add another fee to the already long list of things that tenants get charged for.

squeeks

Experian_company_representative wrote: »

We already hold lots of information that isn't credit.
...
The CRA's role is to collect information that is relevant to your financial standing.

Last time I checked my credit rating, it made no reference to savings and investments, only goods and services made on credit.

No record is kept about peoples spending habits outside of these credit agreements. It doesn't record that you take all your money out in cash on Friday night and p*ss it up the wall and betting on the horses or if you have been saving it for a rainy day.

I am not saying that a credit agency should have this information, but why should they have more than they already have, even if it does allow other people to better understand their financial situation. Sharing information between lenders for fraud prevention is one thing - it is to cover the lenders back side and prevent them from being duped. It isn't really designed to help individuals. In the case of lending money the worst case scenario for not agreeing to a credit check, is you don't get a loan. In fact you won't get a loan without the credit check.

While you say you have a choice to Opt in. How long will it be before you can't rent a house without Opting in. If you choose not to opt in, you don't get the house because as someone else said you must have something to hide...

We're talking about putting a roof over peoples heads here, which can be needlessly jeopardised because you refuse to opt into the scheme or some data entry clerk mistakenly put a default against you.

Next you'll be advocating compulsory national identity cards, phone taps and car tracking devices.

Experian_company_representative wrote: »

If you check your credit report you will see that the credit account section (CAIS on Experian) is just one of several sections that make up your report. Others include Electoral roll, Public financial records, Address links, Previous searches and so on. Rent data will simply be a new section, for people who have some. It will then, with the tenant's permisson, be available to lenders to support their credit rating.

James Jones

The other data you mentioned is public data. You don't need a credit referencing agency to get it, and the credit reference agency doesn't maintain it.

.. also you're asking me to check with the agencies. I have to pay to do this. I don't know when you last tried to cancel some of the credit reporting "products" offered by these wonderful companies, it certainly isn't a one click process to cancel.

Experian_company_representative wrote: »

But that's the thing - it'll much be much easier and quicker for agents and landlords to establish that someone is a reliable tenant, probably cheaper for them too. So it should really improve the tenancy application process for people. I suspect it will make it cheaper too.

Traditionally with this industry, if the costs go down for the LL / LA this just equals a higher profit margin, rather than lower costs to the tenant.

Have you ever heard of a LL approaching a tenant when they finally pay the mortgage and offering a X% reduction because their overheads are now lower?

Swampmonster

Swampmonster wrote: »

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.

Something else that has also just occured to me is what if you are on a Local Authority Housing/Housing Association/Homepoint type list?

Will they also take your credit history into account as well as housing need? As I have previously been classed as homeless this is very worrying.

I know Housing associations wont let you rent with them unless any previous arrears due to them are cleared but what about if you are on a waiting list or homeless because you have been evicted or are due to be from a private landlords property due to rent arrears.

We must protect the vunerable!! No excuses!!

tbs624

Experian_company_representative wrote: »

But that's the thing - it'll much be much easier and quicker for agents and landlords to establish that someone is a reliable tenant, probably cheaper for them too. So it should really improve the tenancy application process for people. I suspect it will make it cheaper too.

James Jones

I suspect that LLs and LAs will *add* this to their list of checks rather than use it instead of the myriad other checks that they already make to try verify the likelihood of a T defaulting on rent payments.

I agree with Callie22's comments - I think you are sadly mistaken if you believe that the application process would prove cheaper. If LAs could charge for breathing the air in their offices then they would do so (whether you are a client LL or a T)

On another of your points:

The data will only be registered with the tenant's consent. It will then only be accessed by the lender with the tenant's consent each time they apply for credit.

you have suggested that tenancy agreements contain a clause in which the T must agree to data sharing. T's can of course not give their consent, crossing this clause through.

However, let's talk about how this will apply in the real world. Those LLs/LAs who think that this sort of database building is a "good thing" may of course simply say to the potential T - "these are our terms, if you are not willing to sign up to them as they stand, in their entirety, then you must go elsewhere".

As a previous poster has pointed out, many LLs and LAs charge the T for scheme registering a tenancy deposit. Now undertaking that registration is of course is a legal requirement for the LL, the T has no choice in which of the three schemes is used but they effectively have no option but to comply with the charges imposed if they want that roof over their head. LAs tend to act almost as cartels - if LA A & B get away with inserting clauses about data sharing, extra "admin" fees and so on then the practice tends to become more widespread. LAs response is of course " you benefit by having your deposit scheme registered"

FATBALLZ

Absolutely ridiculous to try to sell this as a benefit for tenants. I rented for over 5 years and had no problem getting a mortgage, even in the current climate. If a tenant wants to build up a credit history they can just get a credit card and pay it off every month.

This is just money making for experian and another potential blackmail for LLs to hold over tenants.

The basic fact is that out of all the 'businesses' out there, the people who work in property rentals are unquestionably the thickest out there, amateur landlords who don't know even a fraction of the law and letting agents run by school dropouts are the rule rather than the exception. These people cannot be trusted with peoples credit files. And as has been said many times a rental agreement is not a credit agreement, and has no place on a credit history.

As for this only applying for tenants who 'consent' to it, yeah, like people 'consent' to getting guarantors, and 'consent' to paying extortionate 'referencing' fees. Tenants will have no choice, this will be forced on them like it or not.

tbs624

Swampmonster wrote: »

I know Housing associations wont let you rent with them unless any previous arrears due to them are cleared but what about if you are on a waiting list or homeless because you have been evicted or are due to be from a private landlords property due to rent arrears.

We must protect the vunerable!! No excuses!!

A T who loses their home due to rent arrears will ( except in very specific circumstances) be classed as making themselves "intentionally homeless."

The thing is, of course, that anyone who gets evicted on S8, G8 will have had a couple of months of rent unpaid , both at the time of court application and at the time of the court hearing.

What of the T who gets a couple of late rent markers across the duration of their FT tenancy, courtesy of Experian's proposed shiny new database, and find themselves with a S21 from their current LL and then being turned down by other PRS LLs for a new tenancy?

tbs624

lynneinjapan wrote: »

If you apply for a rental property then most letting agents / landlords will run a credit check on you anyway, and it's likely that you'll be rejected on the basis of your past bankruptcy, with no evidence of a good rent payment record since then. On the other hand, if you are honest about your past mistakes and show a good rent record for the past, say, three years or so, then your application might be viewed in a more favourable light.

My bolding I'd agree with you that it's best to be upfront with a potential LL from the start - it can save the potential T being lumbered with referencing fees whilst having no hope of securing a tenancy with that particular LL.

However, as we know, Ts can clearly show their previous/current rent record without needing "help" from Experian's latest money making project

jjlandlord

Experian_company_representative wrote: »

But that's the thing - it'll much be much easier and quicker for agents and landlords to establish that someone is a reliable tenant, probably cheaper for them too. So it should really improve the tenancy application process for people. I suspect it will make it cheaper too.

James Jones

I'm not sure taking the p... while posting as a company representative will really help :rotfl:

At least, I'm hoping that you were taking the p...

tbs624 wrote: »

I think you are sadly mistaken if you believe that the application process would prove cheaper.

This is not being 'mistaken', this is a sales pitch. You believe it at your own risk.