Credit Rating Service Tracks Buy To Let Rent Payments

Landlords are urged to sign up for a scheme that helps tenants build a credit rating every time they pay rent on time.

Credit bureau Experian is backing the Rental Exchange with a drive to recruit letting agents and buy-to-let landlords.

The exchange tracks rent payments, like banks and building societies disclose mortgage payment data to credit rating agencies.

Potentially, Rental Exchange helps tenants who pay their rent on time access financial services on better terms, as their rating improves with every payment.

Landlords who belong to the exchange can also view the rent payment histories of tenants applying to live in a home.

The Rental Exchange has run with social housing tenants for some time, but Experian also wants to expand the service into the private rental sector.

“Despite making regular payments for their housing, private renters don’t see this reflected on their credit report in the same way mortgage payers do. Experian is the only credit reference to incorporate rental payment data into consumer credit reports, enabling tenants to build a credit history by paying rent responsibly,” said an Experian spokesman.

The firm explained that research showed six out of 10 tenants were more likely to hand over their rent on time if a credit rating agency tracked the payment.

Landlords or letting agents with more than 100 rental properties can post rent information directly into the Rental Exchange.

For smaller portfolios, landlords can urge their tenants to join the scheme via a Credit Ladder online portal.

The service is free and landlords.

Credit Ladder collects the payment for the landlord, updates the tenant’s credit rating and passes the payment on.

The Rental Exchange service goes live for finance providers to view from the end of 2016.

View Related Handbook Page

Tenant References and Guarantors

Landlords should interview prospective tenants carefully to assist in choosing one who will be trustworthy and reliable. Taking up references from a prospective tenant’s current or previous landlord, employer and bank can help to inform the tenant selection process.