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Rent payments should be added to tenant’s credit score, says PayProp

PayProp has added its voice to growing calls for rent payments to be added to a tenant’s credit score.

The automated rental payment provider believes that adding rental payments to credit scores as a mandatory requirement would help encourage the ‘next generation of property buyers’.

Credit rating agencies do not currently routinely include rent payment history when calculating credit scores. This means a tenant can find it difficult to access a mortgage, even if they have a long history of rent being paid in full and on time.


“Many tenants have been paying rent on time for years, if not decades. The fact that this does not carry the same weight as a mortgage payment is hard to believe,” said Neil Cobbold, chief operating officer of PayProp in the UK.

“Thanks to the rapid growth of the private rental sector, more tenants are paying higher rents. Taking cognisance of rent payments would therefore make perfect sense, encouraging the next generation of property buyers.”

MPs took part in a debate back in October over whether rent payments should be taken into account when private renters apply for a mortgage to buy their own property.

The debate took place at Westminster Hall after a petition on the issue raised by Plymouth construction worker Jamie Pogson attracted 147,307 signatures, which is significantly more than the 100,000 needed to force a debate in parliament.

After the debate, Lord John Bird, the founder of the Big Issue, launched the Creditworthiness Assessment Bill which pledges to ensure that tenants' rental payment records count towards credit ratings.

The Bill passed its Second Reading in the House of Lords at the end of November and will now have to pass a Report Stage and Third Reading before passing through the House of Commons.

Despite still having to pass through several Parliamentary requirements before receiving Royal Assent, the Bill has gained significant cross-party support and is thought likely to formally become law at some point during 2018.

The campaign for adding rental payment history to credit scores was further bolstered by an announcement made in the recent Autumn Budget. The government has put aside £2m for technology entrepreneurs working to develop an application that can allow the relevant data to be recorded and processed.

The Rent Recognition Challenge will provide funding to the six best proposals to help develop them into workable products.

"Recording and counting rent payments towards credit scores is a modern phenomenon and therefore it needs a modern solution," Cobbold added.

“That's why this is a fantastic idea and one that shows the government is keen to embrace the PropTech revolution.”

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  • Mike Georgeson

    I agree with PayProp that rent payments should improve a tenant's credit file - that's why we already provide this free service to all our tenants at RentalStep.co, as well as free referencing and tenancy agreements.

    If you feel that you and your tenants could benefit from these free services please contact me at mike.georgeson@rentalstep.co or visit our website RentalStep.co


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