Tenant credit risk score

gina_a44

I am a private landlord and have enlisted the services of a third party referencing company to "vet" prospective tenants. This third party obtains its data from Experian.
I have received a report back from this credit check provider which shows no adverse data (CCJs, bankruptcy, etc.). However, the tenant has somehow generated a "very high risk" score. Given that the principal of reciprocity provides that landlords and agents only have access to public data regarding the tenant, I am confused as to how this score has been generated.

I have queried the above with the credit referencing agency and they have stated the following:

The score is not calculated by us, but rather it is provided to us from the various databases that calculate it using various information which is more private, which 3rd party companies such as ourselves are unable to see.

If the above statement is correct then this must mean that Experian has provided access to (albeit, aggregated rather than specific) and generated a risk score based upon data to which neither the referencing agency nor I as the landlord should be party (e.g. loans, credit cards, defaults, etc.). As a landlord with tenants that, aside from this score, seem favourable, I am wary of using this information upon which to base my decision.

I would appreciate any insight you may have in to how this score is generated. Is this score based on private data?

Mermaid89

I am only guessing, but it may be taking into consideration the following:

Previous victim of identity fraud Not being listed on electoral role at current address High % credit utilization Age Financial linked to a third party with bad credit Lots of credit applications in a short time

[Deleted User]

The scores and ratings that the CRA's provide to consumers are made up.

Lenders and 3rd parties use their own lending criteria and algorithms to score you based on the details provided by the CRA's - credit history, data, accounts info, debt, balances etc etc.

The data algorithms and scoring systems that they use is not common knowledge and no one is privy to it accept those that need to know - likely under an NDA as well

gina_a44

Wouldn’t high % credit utilise technically be considered private data and therefore should not form part of the score?

gina_a44

I agree the score is most likely made up but it must be “made up” based on something? They are clearly using some sort of data to obtain a score and based on the rest of the report, this could only be private data.

DCFC79

gina_a44 wrote: »

I agree the score is most likely made up but it must be “made up” based on something? They are clearly using some sort of data to obtain a score and based on the rest of the report, this could only be private data.

Its as Gary says in his last sentence.

Pixie5740

gina_a44 wrote: »

I am a private landlord and have enlisted the services of a third party referencing company to "vet" prospective tenants. This third party obtains its data from Experian.
I have received a report back from this credit check provider which shows no adverse data (CCJs, bankruptcy, etc.). However, the tenant has somehow generated a "very high risk" score. Given that the principal of reciprocity provides that landlords and agents only have access to public data regarding the tenant, I am confused as to how this score has been generated.

I have queried the above with the credit referencing agency and they have stated the following:

The score is not calculated by us, but rather it is provided to us from the various databases that calculate it using various information which is more private, which 3rd party companies such as ourselves are unable to see.

If the above statement is correct then this must mean that Experian has provided access to (albeit, aggregated rather than specific) and generated a risk score based upon data to which neither the referencing agency nor I as the landlord should be party (e.g. loans, credit cards, defaults, etc.). As a landlord with tenants that, aside from this score, seem favourable, I am wary of using this information upon which to base my decision.

I would appreciate any insight you may have in to how this score is generated. Is this score based on private data?

Experian do not generate the tenant risk scores using data about the tenant's loans, credit cards, defaults etc. This is not information letting agent's or landlords can access.

There are two types of Experian tenancy check - instant and comprehensive. Both only use the tenant's public credit files as part of their risk analysis.

https://www.experian.co.uk/background-checking/instant-tenant-check.html

https://www.experian.co.uk/background-checking/comprehensive-tenant-check.html

gina_a44

Yes I understand that nobody is privy to the algorithm. However, the algorithm can only be based on information that is available to the company doing the credit check (in this case, an agency on behalf of myself ) i.e. public data. My point is that if there is no adverse public data then the agency must somehow be accessing private data in one capacity or another. Presumably, an aggregated score based on multiple data sources. I am not asking what data the score is made up of. I’m wondering how they can generate a score based on data that they are not allowed access to. My prospective tenants will no doubt ask how a high risk score was generated and right now, I have absolutely no explanation.

gina_a44

I get this. So how then if there is no adverse public data, can the high risk score occur

System

gina_a44 wrote: »

I get this. So how then if there is no adverse public data, can the high risk score occur

Yes because its all made up rubbish designed to either get people to get credit cards and loans recommended by the CRAs for which they get a kickback or for people to pay them for "credit score improvement" schemes and in the case of landlords to pay for something that generates a random number in order for the CRAs to make you think they're providing value for money.

Pixie5740

Did you read either of the Experian links I gave you? If there's no adverse credit such as CCJ or insolvency then there must be an issue with at least one of the other parameters Experian use as part of the check none of which are the tenant's private credit files.

Do you know if the referencing agency went for an instant check or a comprehensive check?

How do you know the tenant doesn't have a CCJ or is insolvent?