View more on these topics

Rent should affect mortgage eligibility: Treasury minister

Parliament-UK-London-Thames-Building-700x450.jpg

Prompt rent payments should be proof that borrowers can afford mortgages, according to a Treasury minister.

Economic secretary to the Treasury Stephen Barclay made the claims in a parliamentary debate on the issue after a public petition.

In the debate on Monday, Barclay said regulations currently allow mortgage lenders to take rent payments into account, but that credit scores can hamper this.

He said: “The Government agrees that a history of paying rent on time is a factor that lenders can consider when assessing creditworthiness but it is a factor alongside other factors that they should take on board.

“Credit reference agencies being able to access data relating to histories of tenants paying rent will benefit both the buyer and the lender.”

Experian already has a scheme that lets rental payments affect credit score.

Barclay says the Government wants to see more examples of this.

Conservative MP Paul Scully added: “Having a more rounded picture of an applicant’s financial history can lead to more informed decision-making by lenders.”

Shadow Economic Secretary to the Treasury, Jonathon Reynolds also backed the principle of taking account of rental payments.

However, a Government response to the petition said the state would not interfere in lenders’ commercial decisions.

The petition was originally filed by Cornish resident Jamie Pogson and got 147,000 signatures.

Pogson says he has promptly paid £70,000 of rent but was struggling to get a mortgage.

His petition said: “Since living on my own I have paid £70,000+ in rent on time yet still struggle to get a mortgage. Unless you’re getting handouts, wealthy or in receipt of inheritance it’s almost impossible.”

Recommended

Rental-Contract-Pen-Paperwork-Mortgage-700.jpg

UK rents up 2.1% in September: HomeLet

Rents in the UK rose by an average of 2.1 per cent during September, data from HomeLet has found. September’s increase reflects higher rents agreed on tenancies in almost every area of the country. Only the South-East of England recorded a negative rate of annual rental price inflation. The highest increases in rents were seen […]

Houses-House-Money-Notes-10-700.png

North east offers best returns as rents rise across UK

Rents climbed to an average of £904 across England and Wales in August. Nine out of 10 regions saw a year-on-year increase in rents as demand continues to outstrip supply. The fastest growth was seen in the East and North West of England, according to the latest Your Move buy-to-let index. Monthly rents in the […]

House-For-Rent-Home-700.jpg
1

Criticism for Corbyn rent control pledge

Proposals made by Jeremy Corbyn to introduce rent controls have been criticised by commentators. Speaking at the annual Labour party conference in Brighton, Jeremy Corbyn has promised a Labour government would bring in rent controls. The Labour leader said he would give cities the power to introduce rent control and tough restrictions on gentrification projects. […]

Construction soars under build-to-rent

Almost 96,000 homes have now been launched under the build-to-rent scheme. Some 95,918 homes across the UK have been completed, are under construction or are in planning under the scheme. Of those some 17,001 have been completed. A further 24,012 are under construction and 54,905 in the planning stage. The number of homes within the […]

Newsletter

News and expert analysis straight to your inbox

Sign up
Comments
  • Post a comment
  • Chris Hulme 24th October 2017 at 1:53 pm

    Lenders have always had the option to go for a landlords reference its juts that these days of streamlining to process, I suspect many dont want to go down a route that could delay their application to offer performance. I’m sure there are many tenants who would rather not have their rent payment profile forming part of their credit file although landlords would surely welcome this information as much as mortgage lenders would.