Unpaid rent and rent arrears are the main reason for tenant evictions, according to Belvoir’s Q1 rental index, but that could soon be about to change thanks in part to the launch of a rent collection service that incentivises renters to pay their rent on time.
Rent arrears can cause landlords major financial problems, with TheHouseShop recently reporting that rent arrears cost landlords in this country more than £900m each year.
The property marketplace provider claims that part of the problem for landlords is that rent payments often fall behind other outgoings, such as utility bills or mobile phone payments, in the list of tenant’s financial priorities, mainly because unlike most other regular monthly payments, rental payments are not reflected on a tenant’s credit history.
Until recently, private landlords have been unable to do anything to address this imbalance in financial priorities. But with the increasing importance of credit scores in modern financial life, TheHouseShop hope that its recently launched RentScore Plus service, in partnership with credit reference agency, Experian, will help change that.
Crucially, RentScore Plus registers rental payment data with Experian’s Rental Exchange, reflecting late or missed payments on the tenant’s credit reports, incentivising tenants to pay their rent on time.
RentScore Plus also safeguards rental payments, whilst also covering legal expenses and evictions with the added benefit of expert legal advice.
Nick Marr, co-founder of TheHouseShop, said: “There are plenty of landlords out there who cannot financially plan for arrears and have no safety net in place to accommodate for unexpected costs. A large number of buy-to-let landlords rely on their rental income to cover significant payments, such as mortgages, so late or missed rental payments can pose a real threat.
“On top of all of this, we are seeing Section 21 tax changes, increased stamp duty on second homes and the impending tenant fees ban which is putting increasing pressure on landlords, so their rental income is more important than ever. Offering a service that gives landlords financial security is important to us, as we are continually building upon our suite of services which all aim to make landlords lives a whole lot easier and more affordable.
“We love keeping in contact with our landlords and a consistent message from them was the need for financial stability. We heard their concerns and we created a service that fulfills their needs. At such an affordable price, RentScore Plus is flying off the shelves, so to speak.”