Paying rent late will hit credit score

by Property 118

10:42 AM, 11th November 2013
About 5 years ago

Paying rent late will hit credit score

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Paying rent late will hit credit score

Of interest, I think, to fellow landlords; Experian expects to include 600,000 rental records by year-end of tenants who pay late, starting with social housing and expanding to all private rentals. Lenders will have access to the information next year. Paying rent late will hit credit score

Tenants who get a black mark will could ruin their chances of securing a mortgage, credit card or being accepted by their next landlord. Missed payments will damage a credit score, regular payments will improve it ……



Comments

Nick Stott

21:37 PM, 11th November 2013
About 5 years ago

This would revolutionise Landlords' lives!
It seems strange that rent theft is seen as a civil, rather than criminal, issue.
Hopefully, with more accidental professional Landlords (who in my experience seem to take rent theft badly) this will be brought to the fore more.

Sally Randall

11:18 AM, 16th November 2013
About 5 years ago

Reply to the comment left by "Nick Stott" at "11/11/2013 - 21:37":

This is an excellent development, currently the only way to ensure a tenants credit history take into account their failure to pay is if you manage to get a county court judgment against them.

Gary Nock

12:25 PM, 16th November 2013
About 5 years ago

Reply to the comment left by "Nick Stott" at "11/11/2013 - 21:37":

This is to be welcomed. However here is an extract from the money saving expert on the 7 January this year:

Experian is in discussions with major letting agents and landlords to sign them up. It is likely only larger firms will take part, so rent payments to a small landlord with one or just a handful of properties probably won't appear.

Direct consent will be required for rent history to appear on your credit file. This will usually be stated on the tenancy agreement, which you must sign.

Landlords that share your rent history will also be able to access new tenants' credit files so they can judge their likelihood of paying rent on time. However, they will only be able to see your rental history, not your full credit history.

James Jones, from Experian, says: "For the first time in the UK, several million people living in privately-rented properties will be able to strengthen their credit histories by registering details about their rent agreements with Experian."

So as always the devil is in the detail. How do landlords sign up? What verification will Experian want to verify the late payment? Will tenants give consent for this ( probably in the tenancy agreement) I would also think that landlords with rent insurance guarantee who report claims to their insurers would also have the data used for this purpose. Looking at my tenancy agreements the tenant signs in the knowledge that information within it and as a result of the tenancy can be shared with credit reference agencies so I think that is covered.

But the publicity this gives allows landlords quite legitimately to tell tenants that if they are late with their rent then it can affect their credit score. It will not stop the serial rent thieves who know how to work the system but it may deter the rent chancers
who try to delay the rent over Xmas and use landlords as a payday loan.

So overall something to be welcomed.

Allan Wadsworth

20:59 PM, 16th November 2013
About 5 years ago

Hi. This isn't the only way to track bad tenants. I use LRS LandlordReferencing.co.uk to log my bad tenants. The service is still in its infancy but should be very useful in the long run.

Robert Mellors

23:54 PM, 16th November 2013
About 5 years ago

Reply to the comment left by "Nick Stott" at "11/11/2013 - 21:37":

The reference to "rent theft" is interesting, as deliberate refusal to pay rent does appear to satisfy the legal definition of theft within the theft acts, in which case it is a criminal offence, but like you say it is always treated as a civil offence.
I wonder if anyone has ever brought a legal case to challenge this interpretation, or to try to force the police/CPS to treat rent theft as "theft", i.e. a criminal matter?

Gary Nock

4:17 AM, 17th November 2013
About 5 years ago

Hi Robert. Unfortunately the Theft Act 1968 with all its sections mean that something that seems straightforward is not. Each part of the Act has to be satisfied before an offence of Theft is made out. There has to be "dishonest appropriation of property belonging to another with the intention of permanently depriving them of it". And I am sure that it can be interpreted that way. However that is not how the Police and CPS see it. So unfortunately none payment of rent is not classed as theft.

9:29 AM, 17th November 2013
About 5 years ago

@Gary Nock

Thanks very much for sharing that info. Useful stuff. Can you provide a link to the actual post on MSE?

Gary Nock

10:00 AM, 17th November 2013
About 5 years ago

Reply to the comment left by "Vanessa Warwick" at "17/11/2013 - 09:29":

Hi Vanessa. At the risk of sounding like a Luddite I do not know how to do that or what MSE is. Let me know what it is and I will give it a go.

10:02 AM, 17th November 2013
About 5 years ago

MSE = Money Saving Expert. 🙂

Copy and paste the URL link from the top of the thread.

Gary Nock

10:37 AM, 17th November 2013
About 5 years ago

Sorry Vanessa I thought you were referring to my post about the Theft Act. Here is the link:

http://www.moneysavingexpert.com/news/loans/2013/01/missed-rent-payments-could-cost-you-a-loan-or-mortgage

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