Credit Scores Should Consider Rent Payments Says RLA

Rent payments should be considered when credit scores are calculated by credit agencies, says the Residential Landlords Association (RLA).

The RLA conducted a survey of nearly 3,000 landlords, and discovered that 61 per cent of those spoken to would be in support of such a move. The aim behind the change would be to ease tenants in the process of buying their own home by improving their credit score.

Currently, credit rating agencies do not generally include rental payments when calculating customers’ credit scores. This can lead to difficulty when tenants try to access a mortgage, even if they have a previous history of reliability when renting properties and paying rent on time.

The RLA claims that the move to include rent payments would also support landlords when assessing potential tenants. This is as it would offer them a far more accurate assessment of a potential tenant’s credit and rent payment history, enabling them to judge who will be reliable to rent their properties to, and therefore could also help them avoid void periods in their rental properties.

The RLA has decided to write to the government and call for it to work with the industry and include rent payment history as a standard feature when calculating credit scores. They are not the first landlord body to vouch for such a change. Similar suggestions have been made in recent times by the National Approved Lettings Scheme, the Experian credit rating agency and specialist investment property lender Together.

RLA chairman Alan Ward says: ‘It is absurd that rent payment is not routinely included when undertaking credit checks for mortgage applications. Moving to such a scheme would help not just tenants, but also landlords by giving them a clearer sense of whether a prospective tenant has historically paid their rent in full and on time.’

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