Landlords Given Power to Report Late Rent and Avoid Problem Tenants
Landlords have been given the power to access more in-depth credit information about potential tenants and report late rent payments to credit reference agencies, with the help of a new online tool.
Landlords Given Power to Report Late Rent and Avoid Problem Tenants
The credit check service, which has been launched by Landlord Secure, will give landlords a far more comprehensive overview of a new applicant tenant’s credit history, by revealing if the applicant is in arrears with loans or credit cards, and even how much of their credit they are using.
Previously, credit reference agencies were only able to provide identity verification, residential history and publicly available information on a tenant, such as County Court Judgments (CCJs) or bankruptcies, rather than giving an insight into their current credit status.
The new tool will allow landlords to view how many active accounts an applicant has and which are being paid on time, the total balance of unsecured accounts in the previous month, and the worst status of any active accounts for a minimum timeframe of three months before an application was made. This will help to assess affordability and mitigate risk.
Landlord Secure has also recently launched another free tool, LateRent, which allows landlords to report payment history to credit reference agencies, enabling them to conduct robust affordability assessments on potential tenants.
The move comes after the Residential Landlords Association (RLA) called for credit reference agencies to include rent payment history, to aid in the calculation of credit worthiness and affordability of renters.
LateRent will report a registered tenant’s monthly payment status, and this will show up on any future credit searches carried out by financial institutions.
The system also allows tenants who pay their rent on time to build up a good credit history, which could assist them with future mortgage or credit applications.
The Managing Director of Landlord Secure, Steve Burrows, says that the new tools will be a benefit to good tenants, while improving the lettings process for landlords: “Chasing late rent payments can be an all too familiar issue for landlords to find themselves in. Tenant vetting checks and referencing services are meant to help them avoid these problems, but most are not comprehensive enough and the information they gather doesn’t present an accurate picture of an applicant’s current credit status.
“This new credit check service, coupled with the LateRent platform, will make it much easier for landlords to select the appropriate tenant. It will also enable tenants who pay their rent on time to build up a better credit history, which may help later if they apply for other credit or financial products.”
Landlords, remember that the best way to protect your pocket against tenant rent arrears is with Rent Guarantee Insurance: https://www.justlandlords.co.uk/rentguaranteeinsurance
