MSE News: Missed rent payments could cost you a loan or mortgage

kingstreet

Typhoon2000 wrote: »

True, but it should. Regular rent payment should show that you can manage a household whilst some some living with parents rent free might not have any experience of.

I was speaking more about the difference in rent v mortgage payment influencing affordability.

As I mentioned, lenders do sometimes look for a good payment record as part of their status enquiries and this is entirely appropriate.

ruggedtoast

Typhoon2000 wrote: »

I think this will be a good thing whe it comes to apply for a mortgage as it show the mortgage company that you have been comfortably paying rent every month on time that is greater than the future mortgage payment. Should help with proving affordability.

Affordability is down to your salary and the purchase price, nothing to do with your prior financial commitments.

Credit checks are meant to be just that, rent isnt a credit line so it shouldnt be something Experian looks at.

If you want to build a good credit history a mobile phone contract and a couple of credit cards you pay off in full each month will do just fine.

Pincher

It's unworkable. The information will be patchy and inaccurate.

The last Letting Agent I tried has a huge turn over of LOW quality staff. What chance do they have of consistent data entry with a bunch of spivs and ladettes who just want to make a fast buck and go out to party.

The only way is to have a central server with data auditing, maybe sub-contracted to a bank, but supervised by ARLA. The letting agent will set up the accounts for landlord and tenant, and lodge the deposit as well. The tenant can choose to use Direct Debit or other methods. It's largely automated, so it shouldn't be too expensive. This can make the DPS obsolete, as the letting agent can transfer the deposit into the tenant's or landlord's account easily.

If run well, I think people will even PAY to use this service.

V_Chic_Chick

Hang on a minute, how are we going to know that the people adding information to the credit files are actually their landlords at all? Many people (myself included) rent from a private individual who only owns one or two rental properties, and whose main income comes from a job, as opposed to a letting agent.

If someone was seriously malicious (an ex partner, for instance?) then there would be little to stop them claiming to be the LL, and claiming that they were in arrears. Any tenancy agreement could be forged without too much difficulty, claim that there was no deposit (therefore no DPS paperwork)....

LLs can already take tenants to court for unpaid rent and have a CCJ issued against them, which will royally mess up their credit rating for the next 6(?) years. Surely that's sufficient?

Experian_company_representative

Tenants and small private landlords will be able to participate. We're launching the registation site for this quite soon.

I agree - most people do pay rent on time so most will benefit. It will also help ID verification, which is often based on credit report information.

Data protection law will apply to rent data just like other personal records.

James Jones

V_Chic_Chick

Experian_company_representative wrote: »

Tenants and small private landlords will be able to participate. We're launching the registation site for this quite soon.

I agree - most people do pay rent on time so most will benefit. It will also help ID verification, which is often based on credit report information.

Data protection law will apply to rent data just like other personal records.

James Jones

As someone who has always paid their rent on time, how can you guarantee that my credit rating will not be affected by the malicious actions of my landlord? What recourse will I have when I can't get a loan at a reasonable rate, or I am refused a job in the finance sector because of false information that has been maliciously added to your database?

smala01

chanz4 wrote: »

who will be liable if they report false info, and make them compensate as they are not regulated the same

The same dreadful way that refrence agencies usually behave.

Wrong infomration was recorded against my profile relating to an address where i have never lived approx 300 miles away in Cornwall - This resulted in me failing every credit check for 3 months until this information was removed - think about if this was a mortgage application or similar. I couldn`t even change my mobile phone provider

O Refrenece agency would not deal with the complaint over the phone - everything had to be in writing (why?)

O Refreence agency claimed that they had contacted said bank and they had refused to remove the information. When challenged could not supply one name / department or "how" they had asked the bank. No-one in the bank could find reference to this.

O Bank call center / branch had no clue how to resolve this

O Bank customer service written response blaimed the credit reference agency

O Credit reference agency advised to "dispute" the information, however it was up to providers to decide how they used this disputed information.

O Credit reference agency took no resoponsibility, or applied zero common sense to the problem. Refused to remove this infomation whilst in the process of dispute

O Bank (data "owner") - as i would imagine most firms, didn`t have clue how to fix the problem as this was off-script for their administartion staff.

O In the end I applied for home address of the directors for both the bank and credit reference agency from companies house and sent notice before legal action letters for them to read over breakfast. Thankfully it was fixed within a week.

When things go wrong there is no help for you. It can litterally ruin someone's life for many months and prove very expensive in being blocked for more competative financial products that require credit checks.

Smala01

mcbob_2

I'm not against this perse, but I doubt Experian's motives...

There is also no credit agreement involved with a tenancy agreement - this is why there are other background checks undertaken (at the tenants expense).

Is it legal for non credit related agreements to be harvested like this I wonder? A grey area I suspect.

At the moment this is just another data land grab for those companies that have the market cornered - Equifax do similar with British Gas and EON.

In a better place this whole industry would be a government agency and there would be no profit motives - after-all it's our data.