Sub-letting

OliverNW3

Hi everyone
Just a quick question - I moved to London mid 2018 and found a nice place in a nice area which I would hate to give up. The only problem is I'm sub-letting. I'm just wondering if this is ultimately bad for my own prospects and if 2020 should be the year I move on and rent properly with a contract etc and I'm also wondering in what ways can sub-letting come back to bite me - will it negatively impact my credit score etc?
Financially the current place is perfect for me, rent isn't too high and I found myself in a nice community etc, I really love the area but feel if I was to branch out on my own this area would be out of my price range. One day I do hope to buy a flat of my own as a first time buyer (but don't foresee that in the next 18 months anyway).
Any tips or help gratefully received!
Thanks

G_M

Nothing wrong with sub-letting, either legally or practically.


But for more detailed response, who is your landlord and who is their landlord? (no names - just clarify the chain.



Are you a tenant or a lodger?

OliverNW3

Thanks - to clarify, I'm a lodger. The other person in the flat has rented from an agency, so the contract is in her name (2 bed flat). From what I can gather (not sure if I could claim ignorance as a defence) she is not allowed to sub-let the flat (i.e. I pay my rent to her but she didn't want rent mentioned in the reference). I imagine her contract is with the agency and not the ultimate owner but I haven't seen it, and I have no contract of my own. It's never been as issue as the two of us living here get on really well. It's just that I've begun to think of her own financial situation as being precarious (out of work) while mine is okay, and I'm beginning to wonder what might happen to me if she can no longer pay the rent at all.

[Deleted User]

OliverNW3 wrote: »

Thanks - to clarify, I'm a lodger. The other person in the flat has rented from an agency, so the contract is in her name (2 bed flat). From what I can gather (not sure if I could claim ignorance as a defence) she is not allowed to sub-let the flat (i.e. I pay my rent to her but she didn't want rent mentioned in the reference). I imagine her contract is with the agency and not the ultimate owner but I haven't seen it, and I have no contract of my own. It's never been as issue as the two of us living here get on really well. It's just that I've begun to think of her own financial situation as being precarious (out of work) while mine is okay, and I'm beginning to wonder what might happen to me if she can no longer pay the rent at all.

You're not sub-letting you are an excluded occupier. You do not have exclusive occupation of all or part of the property unlike your landlord who is a tenant.

OliverNW3

ah right. Hadn't even heard of the term if i'm honest. Anyway, regardless of my rights as a tenant or an excluded occupier (it doesn't bother me), is it bad from a financial perspective i.e. credit score etc

[Deleted User]

OliverNW3 wrote: »

ah right. Hadn't even heard of the term if i'm honest. Anyway, regardless of my rights as a tenant or an excluded occupier (it doesn't bother me), is it bad from a financial perspective i.e. credit score etc

What credit score?

Does your landlord report your rent payments to Experian using the Rental Exchange? If so do you make all your rent payments on time and in full each month?

OliverNW3

No. I pay the other tenant privately, always on time of course, but the agency is unaware. As far as they're concerned she is the only person on the tenancy.
My question is should I be looking at moving to keep everything above board to improve my credit score etc or is it going to look like I've been living rent free for 18 months, which I haven't.

Retired_Mortgage_Adviser

If the current arrangement suits you (and it looks like it does!) there is no need to move. Your housing situation and how you pay rent (as described in your posts) has no impact at all on your credit history.

OliverNW3 wrote: »

No. I pay the other tenant privately, always on time of course, but the agency is unaware. As far as they're concerned she is the only person on the tenancy.
My question is should I be looking at moving to keep everything above board to improve my credit score etc or is it going to look like I've been living rent free for 18 months, which I haven't.

00ec25

OliverNW3 wrote: »

No. I pay the other tenant privately, always on time of course, but the agency is unaware. As far as they're concerned she is the only person on the tenancy.
My question is should I be looking at moving to keep everything above board to improve my credit score etc or is it going to look like I've been living rent free for 18 months, which I haven't.

you are a lodger (or as pointed in correct legal terms: an excluded occupier). There are hundreds of thousands of lodgers across the UK.

Do you really think an agency looking to vet you when you try and get a rental in your name will never have had to deal with someone who was previously a lodger? really?

Your credit score is not impacted by the fact you were a lodger, or a tenant for that matter. I presume you do not actually know what a credit score is? No one renting from a landlord is going to have their credit score impacted unless they have failed to pay rent and were successfully taken to court by their LL who then also sought a CCJ (county court judgement) against them.
On the other hand. if they paid on time there is no way on earth that would ever be reflected in a "credit score" as the LL has no contact whatsoever with the scoring agencies, and the agencies do not know you exist, and care even less that you paid rent on time to a landlord they know nothing about.

If you have no other evidence of being a good boy and paying on time (eg: credit card? mobile phone contract? as those are sources that the credit agencies will be following ) then a letting agency may (note may, not will) ask for a reference from your landlord in support of trying to work out if you are a payer.

your landlord is the person you pay the rent to. You are not subletting, and who your LL pays their rent to is utterly irrelevant.
Of course if that person refuses to commit in writing that they had rent from you, then you cannot make them. No one can say if your chances of success with an agency would be impacted by lack of such a reference. As said, there are loads of people in exactly the same circumstance for their first place.

[Deleted User]

OliverNW3 wrote: »

No. I pay the other tenant privately, always on time of course, but the agency is unaware. As far as they're concerned she is the only person on the tenancy.
My question is should I be looking at moving to keep everything above board to improve my credit score etc or is it going to look like I've been living rent free for 18 months, which I haven't.

So if your landlord isn't reporting anything to the credit reference agencies then your living situation makes not one jot of difference to your credit history.

G_M

* You are an Excluded Occupier - in common language, a lodger, not a tenant.
* your landlord is the other person you share with.
* Your landlord is not breaching her own tenancy agreement as she is not subletting the entire property to you for your exclusive use, she is granting you a licence to use 1 room and share the rest of the property.
* your credit history can be impacted. If and only if
1) you fail to pay the rent agreed or damage the property AND
2) your landlord (with whom you share the property) takes you to court AND
3) your landlord wins in court and the court orders you to pay AND
4) you still fail to pay AND
5 the landlord then applies for a CCJ against you.


How likely is all that?