Renting/room sharing whilst buying a property - credit checks and changing address

alreeve27

Hi everyone.

I have sold my house chain free as I split up with my partner and have exchanged with a completion date in mid Jan. My aim is to buy another property next year but nothing suitable has come up yet. I have a few options for where to go in the meantime - stay with parents, be a spareroom lodger or possibly rent for 6 months with a friend who is looking to move.

I have been cancelling contracts eg utilities etc but am unsure about whether I can have different addresses linked to different things. For example it makes sense to redirect my post to my parents’ house whilst I have no other plans. I also could move my car insurance address to theirs too and leave the car there even if I rented as it would be in London. Would I use this address on my driving licence? Or would I need to change both to any temporary place I rent? I know that being on the electoral register is important for the mortgage application too, so what would I do about this?

If I were to rent with my friend, I presume I would be credit checked. So would this negatively affect my credit score (which is 999 and I have owned my home for 8 years and paid credit cards in full etc) at a point where I may be weeks/months away from applying for a mortgage?

I’m a bit unsure and want to make sure I am doing things correctly ahead of buying another place.

Thanks

bbat

Those with more experience would be best to answer but renting/flatshare didnt affect my own credit score. 

I would expect its better for mortgage applications if everything is registered at one property (where you are also on electoral register).

K_S

@alreeve27 A recent move to a friend's place, family home, rental property, etc. should not be a huge impediment to your chances of a mortgage. I have had plenty of clients who did similar during the pandemic who wanted to sell their property first and then look for an onward purchase in a relaxed manner, or those with wfh flexibility who gave up their rental property in the city and moved in with parents, etc. and then looked to buy.

With regard to your credit file, it would be ideal if you were registered at wherever it is that you are living and that address matches those on your credit accounts that show on the credit files (current account, credit card, some utility/phone accounts, loans, etc).

A few accounts being at a different address is not necessarily a deal breaker but with lender's automated systems, it sometimes can trip up an application, especially at high-LTV.

alreeve27

Thanks @K_S, that’s really helpful. I think it’s likely I’ll be at my parents for a bit first so can change credit card address etc to there. LTV is about 60% by the way on the sorts of properties I’d be looking at.

With a Spareroom arrangement where I would be a lodger but may have no official contract etc, presumably it would be ok to leave everything registered at my parents’ as I wouldn’t be linked to any bills or anything to do with the place I were staying, and would be short term. Does that sound sensible?

Thanks