Click here to view the original article ‘Should a tenant’s rental payments appear on their credit record’



  • A tenant’s rental payments can now appear on their credit score
  • It means that if they don’t pay, there will be a default on their credit record
  • Tenants can currently opt out of the scheme if it is run by their lettings agents

It’s a risk every landlord takes when renting out a property. That their tenant doesn’t pay up.

It can be an extremely painful process if this happens, taking potentially months to evict a tenant. And all the while, landlords lose valuable income that hits their profits hard.

But a new initiative by credit agency Experian means that tenants’ rental payments can now appear on their credit scores.

James Cameron, of Vesper Homes, is one of the agents working with Experian as part of the initiative.

He said: ‘We wanted to stand out from the crowd and let landlords know that when they let their properties through us they will get a good class of tenant who will pay on time.

‘It helps us to get landlords on board. We can say to them we have more leverage to get tenants to pay.’

It is a small bit of welcome news for landlords who have been hit by a succession of unwelcome policy announcements in recent years, including the reduction of tax relief and the 3 per cent stamp duty surcharge.

So it is good news for landlords, but what about the tenants?

Obviously it is not welcome if you’re a tenant hoping to get away with not paying your rent on a regular basis.

If tenants don’t pay, there will be a mark on their credit record.

Tenants can still opt out of such a scheme if it is being run by their letting agent.

But the majority don’t opt out of the scheme, insists Mr Cameron. This is because they can see the benefits of paying on time and it being on record.

It means they are more attractive to another landlord should they rent an alternative property in the future.

It is still early days, but there is also the possibility that tenants may be able to use the rental payments on their credit score as a way of helping them to secure a future mortgage.

If a lender sees that they were able to keep up with their monthly rental payments, they will surely be more attractive to lenders.

As such, it seems to be a win win for both responsible landlords and tenants. It is also a welcome move for an industry examining the benefits of tenant passports, which can be carried from one property to another.

It may soon be only a matter of time before it is compulsory for all tenants to sign up to the initiative and having their rental payments on their credit files.


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