MSE News: U-turn means flatmates' poor credit won't harm you

Consumerist

My question is: Who in the world will NOT have access to my credit file?

HAMISH_MCTAVISH

Callie22 wrote: »

As a tenant, unless I pay to frequently check my credit score, then it's likely that I'll only find out that there's a problem when I'm suddenly rejected for a rental property.

Not at all.

The average tenant moves house, what, once every 12-18 months?

Paying £2 once every year and a half or so to check your own report a couple of months before moving is hardly an expense worth worrying about, nor even any kind of real inconvenience.

I'd suggest everyone should check their own credit report at least that often anyway to protect against errors or identity theft.

HAMISH_MCTAVISH

credit-geek wrote: »

My concern is with younger renters, like students, who are not concerned about their credit files, and it is good they will not, now be held liable on joint tenancies, if their co-tenants, miss payments.

That's not the case, from what has been announced so far.

All that is being proposed is that further information will be provided where possible.

Ultimately, where a tenancy is joint and several then all tenants are responsible for ensure all rent is paid on time. If it's late, it should reflect badly on the credit rating of all responsible parties.

toby3000

jamie11 wrote: »

I think it's good .....as far as it goes but there are a huge number of tenants that really don't give a toss about their credit scores, for those responsible ones then all well and good, it might help them climb the ladder, for those not-so-responsible what is going to change? They have a bad score now, they will have a bad score then.

Exactly. As a rule, people who don't pay their rent also don't pay their mobile phone bills or council tax or anything else, so their credit score is already trashed.

Maybe Newcastle is an unusal case, but I've lived in 5 different houses and have only once had a credit check done, and as long as you avoid going through agencies you never have one undertaken. And I know from my own landlord that the agencies don't pass the rents on in a timely fashion, so I'm not sure how that would impact on the situation.

aldredd

One thing I would worry about, is if, at the moment, there is a clear path of escalation to follow if something goes wrong on your credit file. There are government bodies who can hold lenders to account and get issues fixed (and even then it doesn't always work, or is difficult). What protection would there be for those who believe there is an error but the LL refuses to change it? (especially if you parted on bad terms and LL feels they have nothing to lose)

HAMISH_MCTAVISH

aldredd wrote: »

What protection would there be for those who believe there is an error but the LL refuses to change it? (especially if you parted on bad terms and LL feels they have nothing to lose)

Fairly sure the credit reference agencies will have processes in place to prevent abuse.

I'm sure if you can prove you made a payment they'll be able to correct any mistakes.

aldredd

HAMISH_MCTAVISH wrote: »

Fairly sure the credit reference agencies will have processes in place to prevent abuse.

I'm sure if you can prove you made a payment they'll be able to correct any mistakes.

I'd love to believe that, but I know that the vast majority of the time, it doesn't matter if the evidence is smacking them in the face, they still won't change it, insisting that you get it corrected at source - with their 'best offer' being a NOC. And that's from personal experience with them.

(I had been incorrectly linked to an address hundreds of miles from where I lived at the time. The bank admitted in writing it was incorrect, but no amount of pestering would get them to actually correct it, and so sent the letter to Experian, but they still refused)

Callie22

HAMISH_MCTAVISH wrote: »

Not at all.

The average tenant moves house, what, once every 12-18 months?

Paying £2 once every year and a half or so to check your own report a couple of months before moving is hardly an expense worth worrying about, nor even any kind of real inconvenience.

I'd suggest everyone should check their own credit report at least that often anyway to protect against errors or identity theft.

I've moved home more often than that, as have most of my friends. And I'd argue that you'll need to check your credit record much more frequently than every 12-18 months, given that it'd be really unwise to get a point where you only find out there's a problem when you're trying to move. My Letting Agency can't even remember when they've booked appointments to visit, I certainly don't trust 'Shanice on reception' to get the information she passes on to Experian right. Although 'it's only £2' I don't agree with this on principle - I already pay for credit checks when I move house, I pay to get my deposit protected, I pay fees for a LA to create a contract. I don't see why I should end up having to pay even more. There are already lots of ways for a LL/LA to check on a tenant, the costs of which are in most cases are already passed on to the tenant anyway.

If the checks that already exist are carried out properly, then you'll weed out 99% of the bad tenants - when most LLs complain about bad tenants you find out pretty quickly that they ended up with these tenants because they (or their Agents) didn't bother to credit check or reference properly. I see no reason to add another un-necessary layer of bureaucracy, particularly when it's dressed up as being 'for my benefit' and I have to pay to police it.

HAMISH_MCTAVISH

Callie22 wrote: »

I've moved home more often than that, as have most of my friends.

Most people don't though.

And I'd think for the few who do regularly move every few months having a record of good rental history on a credit report would be even more important.

It certainly would be important for their prospective landlords, and indeed for lenders in the future, as I can't see many people looking favourably on someone that has had 10 addresses in 5 years.

Not exactly a good sign of stability, is it?

And I'd argue that you'll need to check your credit record much more frequently than every 12-18 months, given that it'd be really unwise to get a point where you only find out there's a problem when you're trying to move.

Only if you're in the tiny minority who move that often. In which case it might cost you a whopping £4 a year instead of £2 a year.

Hardly a burden...

My Letting Agency can't even remember when they've booked appointments to visit, I certainly don't trust 'Shanice on reception' to get the information she passes on to Experian right. Although 'it's only £2' I don't agree with this on principle - I already pay for credit checks when I move house, I pay to get my deposit protected, I pay fees for a LA to create a contract. I don't see why I should end up having to pay even more. There are already lots of ways for a LL/LA to check on a tenant, the costs of which are in most cases are already passed on to the tenant anyway.

Obviously you don't like lettings agents. Which is fine. But not of any relevance to the discussion.

If the checks that already exist are carried out properly, then you'll weed out 99% of the bad tenants - when most LLs complain about bad tenants you find out pretty quickly that they ended up with these tenants because they (or their Agents) didn't bother to credit check or reference properly.

Hang on.

You've just claimed there are a sub-group of people who move house every few months.

You now expect a lettings agent to spend half a day or so on the phone tracking down perhaps 10 or 20 former landlords to make sure you didn't stiff any of them for the rent.

You don't think they have better things to do than waste time tracking down dozens of former landlords of these "frequent flitters" all day when a simple credit search could now show precisely whether or not the rent was paid on time?

Seriously?

I see no reason to add another un-necessary layer of bureaucracy, particularly when it's dressed up as being 'for my benefit' and I have to pay to police it.

Rental arrears and defaults cost everybody in the long term, as the risk of defaults will eventually get priced into the market.

Something which minimises the risk to the landlord will almost certainly result in lower costs and wider choice for good tenants, and higher costs/less choice for bad ones.

Callie22

Hamish, I've moved frequently for a number of reasons - because of work, because my landlord wasn't paying his mortgage and was repossessed, because my landlord lied about a 'long term tenancy' when in fact they were selling the house. Your post seems to suggest that a tenant who moves frequently is somehow responsible for that, and is somehow trying to hide something by moving. That's not true, and it's a little strange, given the state of the current rental market, to suggest that.

As I said, my disagreement with paying to check my credit record is on principle - there are many fees involved in renting and I don't agree that any more should be added. The point I made in my previous post about letting agents is relelvant - they are not regulated, can make mistakes and can charge extortionate fees because nobody is really policing the industry. Therefore, I feel strongly that they should not be allowed to have an effect on my credit record, not unless they are going to be more heavily regulated and I can have genuine redress if they make a mistake that costs me either money or somewhere to live.

And yes, I do expect a letting agent to spend 'half a day on the phone'. It's not really a lot of time considering how much money they take off tenants and landlords in their fees. Lets not forget, a letting agent is providing a service to the landlord - surely as a landlord you would expect a letting agent to spend 'half a day' checking that the person they're going to give the keys to your house to is actually going to pay the rent? I know for a fact that my last letting agent didn't contact either my place of work or my ex-landlord when they were carrying out their checks - hardly doing their job, were they? Fortunately I'm a good tenant so my landlord has nothing to fear, but if I wasn't, then I'd easily have got a new place to live and I could have just as easily not paid the rent once in there. If agents and landlords don't carry out the checks that are already there then what's the point of adding more?

If as you say, it's a 'sub-group' of tenants that move frequently then for most people it won't mean that the agents spend 'half a day' on the phone. In the odd case it might, but isn't that the agent's job?

I also disagree that any move will result in lower costs for tenants. It hasn't happened before, so what makes you think it will happen now?