Experian launches rent payment profile for tenants

Experian launches rent payment profile for tenants

14:52 PM, 16th March 2012, About 9 years ago 35

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Missing a rent payment could affect a tenant’s credit rating as one of the largest credit checking firms opens a new service for landlords and letting agents.

Experian is opening data files on a tenant’s rent payment history as a new check for landlords and letting agents vetting renters who want to move in to their homes.

The service is likely to do away with references and allow landlords to make more informed decisions about whether to let.

For tenants, failing to pay the rent could damage their credit profile when they seek borrowing, like credit cards, loans or a mortgage to buy their own home.

Experian is selling the service as a way for tenants to strengthen their credit history and to help them qualify for better and cheaper credit.

Landlords and letting agents will have to pay a small fee to access Experian’s Rental Exchange – but the company also wants them to sign up as information providers.

Due to data protection laws, tenants will have to agree that their payment data is forwarded to Experian.

The company reckons that gathering data on the UK’s 3 million plus tenants will take at least year due to the disparate nature of the lettings industry, which is largely managed by independent landlords and letting agents.

Paul Vescovi, UK and Ireland managing director of Experian credit services, said: “With several million people living in privately rented accommodation, a significant percentage of the population could be missing out on mainstream, low-cost credit because lenders do not currently have a comprehensive picture of their financial track record.

“The Rental Exchange will strengthen people’s credit histories, helping them to access a wider range of credit deals.”

Another of the big three credit agencies, Callcredit, is also rumoured to be looking at a similar service.



Comments

by

23:09 PM, 20th March 2012, About 9 years ago

I think one if the issues surrrounding reinstatement is if the domestic circumstances have changed since the last credit check, which would mean that they wouldn't pass another RGI check.
This will then leave the LL without RGI cover.
With myself doing the RGI the tenant does not have to suffer another credit check if I renew the policy.
I think therefore I will keep the status quo as I manage things.
I'm a bit dubious about radical changes which I suspect may expose me to further risk
Having been badly burnt by wrongun tenants I am  less predisposed to radical change to circumstances that I do know work and give me confidence.
So evolutionary change rather than revolution is my mantra
I suppose I am being a bit conservative but I prefer that way presently

by

18:41 PM, 31st March 2012, About 9 years ago

Though Experian started as and continues to be a UK company, they are one of the big three credit bureaus in the USA. The idea of rent being reported so a tenant can build or add to their credit history is an established concept. It is really useful to landlords who are offering a property on a rent to buy basis. You want the tenant buyer to build up as good of a credit history as possible so they can eventually obtain financing and exercise the option to buy.

Expecting a merchant who pay for access and to report is normal in most all sectors. It is a cost of doing business when you are extending credit. While it might be argued that a landlord is not extending credit it sure feels that way when you think through the risks associated with non-payment.

I do wonder about rent guarantees and insurance. The USA market is much older in terms of a PRS and there really isn't an insurance option. It is pretty hard for insurance companies to price correctly the default risks and costs. Look at the horror stories about how much it costs to get a tenant out. In the USA most states have laws that make the eviction start sooner and resolved sooner. That translates into lower costs for evictions. Lower costs will tend to make it possible for someone to price the risk and insure the risk. With that said I do not know of insurance for landlords to protect against tenants not paying.

by Mark Alexander

20:19 PM, 31st March 2012, About 9 years ago

Welcome to Property118 John - the answer to your insurance question is here >>> 
http://www.property118.com/index.php/tenant-referencing-rent-guarantee-insurancergi/26857/

by

0:01 AM, 2nd April 2012, About 9 years ago

John; bit unsure as to what you mean.
Do you think it is not possible to obtain insurance against a tenant not paying rent or is that in the USA.
Go onto the discountlettings.co.uk website and click on Rent Guarantee Insurance.
The point you make about USA evictions being quicker is the main reason that small LL need RGI.
The county court system here is so useless it can bankrupt a small LL as it nearly has me.
Only credit cards saved me from losing even more properties.
RGI is something I have no choice but to have.
Also I would NOT pay to access someone's rent history.
That would be down to the RGI company.
If they choose not to check it out, more fool them as I will pay for the referecing and be covered.
If it turns out the tenant passed the credit check but the RGI company didn't check rent history that would be their problem.
I get paid if the tenant chooses not to pay rent, so what do I care about a tenant's rent history.
It is up to the RGI company to exercise full DD, if they don't, that's their lookout.

by

10:36 AM, 18th May 2012, About 9 years ago

A very nice step for  minimize  the LL problems about tenant late rental payments,May be these types of add ons make tenant  to think seriously about their credit  score which otherwise neglected by them


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