North East rental initiative could improve renters' credit scores
A new initiative from Experian is set to help private tenants improve their credit histories. Galley Properties is set to be the first estate and letting agent in the North East to provide this new service, which could make a difference to a huge number of renters.
The Rental Exchange initiative has been launched by Experian with the big Issue Invest and aims to help improve credit ratings by recording the rental payments made by private tenants. This means that rent payments will help improve credit histories and be recognised in a similar way to mortgage payments, which, historically, has not been the case.
A lot of people who are currently renting properties eventually wish to buy their own home, which Rental Exchange could help them get into a better position to do due to an improved credit rating. Not only does the initiative help to improve credit histories, it also supports better electronic verification of a tenant's identity when applying for online financial services.
Head of Rental Exchange at Experian, Vicky McNab, said: “A strong credit history helps people to access mainstream financial services, from bank accounts, credit cards, personal loans and mortgages, to mobile phone and utilities contracts. In the past, building a good credit rating has been easier for homeowners than for tenants, because mortgage payments are factored in. The Rental Exchange will help level the playing field for tenants.”
Galley Properties is hoping that working with this scheme will benefit the hundreds of tenants who rent through the agent and ensure they have access to fairer opportunities in the future. Teresa Galley, director of Galley Properties, said that the agent is working hard to put the initiative in place to help balance the disadvantage renters have when it comes to their credit score.
Chantal Perkin, chief lettings negotiator at galley Properties, said: "There is also an extra incentive for tenants to keep on top of their payments as they seek to build up their credit score. This could potentially lead to even lower rent arrears and help keep each property rental running smoothly. Our lettings team see this as a win-win situation for both tenants and landlords.”