The mandatory adding of tenants’ rental payments to their credit histories took a step further today.
A Private Members bill introduced by House of Lords cross-bencher Lord Bird (pictured, right), who founded the Big Issue magazine and homelessness charity, is to get its second reading on 24th November, it has been announced.
His Creditworthiness Assessment Bill – if it becomes law – will require mortgage lenders to take into a tenant’s rental and council tax payment histories into account when calculating credit scores.
Credit score rise
Lord Bird is not alone in his endeavours. An e-petition signed by over 147,000 people was discussed last month in Westminster Hall and addressed by several key MPs including Economic Secretary to the Treasury Stephen Barclay and Labour spokesperson Jonathan Reynolds.
He said 80% of tenants who had already signed up to one of the services that reports rental payments to the credit agencies saw their credit score rise.
“Crucially, it has added a digital footprint, which is so important these days, for many people who simply did not have one before,” he said.
Also, the Financial Conduct Authority has only just finished a consultation on assessing creditworthiness, and is due to issue a policy statement early next year.
“By strengthening credit reports, authenticating digital identities and providing greater access to mainstream financial services, it is an opportunity to improve our financial system, and the life chances of Britain’s renters,” says Lord Bill.
His Private Members Bill might not normally have much chance of making it through both houses of parliament, but a Conservative government keen to do anything to help young renters get on the property ladder, and the previous cross-party support for similar policies – such as the tenant fees ban – mean it is likely to become law.