Repairing a Poor Credit Rating in order to rent...

Admo10

My partner and I are eager to rent a property , my only concern is that I have recently recovered from 3 years of very poor credit.


I was in a very difficult financial position a few years ago which unfortunately resulted in me taking out payday loans and racking up lots of debt.


3 years later , I have now recovered somewhat and have paid off all the debt I had so am now happy to be debt free! The only problem is that my credit score is still showing as 'very poor.' I understand that this is due to the payday loans.


I don't know how this will effect me renting a property , I don't want to apply for places and get rejected , adding lots of searches on my credit score.


Is it best to be honest with landlords about your financial situation before a credit check is done?

Zenboor

Admo10 wrote: »

The only problem is that my credit score is still showing as 'very poor.' I understand that this is due to the payday loans.

Not sure this entirely accurate. I've had PDLs in the past (all paid back on time with issues) and this didn't have an adverse effect on my report as far as Experian and other lenders as I was able to acquire high street credit without too much hassle.

There has to be more that just PDLs in your credit report. Do you have late payments? CCJs, defaults? or too many late payment markers?

Rob_Mogs

I have no answer to any credit issues as I just don't know, however YES, it is best to be honest with the landlord/letting agent, as there are other ways, We had considered renting for 18months until we can buy (as have to wait for a default to drop off my file.)

We told them about my credit history and said that we can offer 6 months rent in advance.

Admo10

I've just downloaded my Experian Report :
It says that the 4 negative factors affecting my score are :


The average age of your credit accounts is 13 months
The usage of your available credit indicates a higher risk.
Your highest credit limit on a single revolving credit account is £450.00 or less.
You have issued 2 new credit applications within the last 6 months (payday loan extensions)


I am now totally debt free , I can prove this via bank statements etc Im just wondering how long it will update on Experian?

DCFC79

Forget the credit score, what matters is the credit history.

Tixy

Admo10 wrote: »

I've just downloaded my Experian Report :
It says that the 4 negative factors affecting my score are :


The average age of your credit accounts is 13 months
The usage of your available credit indicates a higher risk.
Your highest credit limit on a single revolving credit account is £450.00 or less.
You have issued 2 new credit applications within the last 6 months (payday loan extensions)

None of those 4 things would be visible on a credit check for a tenancy agreement.
A credit check for a tenancy does not show any information relating to credit account history.

It only shows public information, that is whether you have any CCJs, whether you have a record of bankruptcy or insolvency in the last 6 years and whether you are on the electoral roll.