So, my question here is this - how can a credit check be forced upon us to apply for a property when in fact, you are not applying for a credit facility?
The majority (if not all) tenancies (certainly ones I’ve had) have ALWAYS been a case of, rent up front, deposit up front etc. So given all the rules and regs about GDPR and using correct information etc, if im not applying for a credit facility (and seriously, im not if im paying up front), why is having a credit check the be all and end all for an application?
Its inaccurate, does not reflect my true situation (for example) as it stands at that moment. If all finances are to be up front as standard practice would dictate then why so much value on a credit check?
In particular if you can prove your income, provide up front monies and a guarantor?
It is not forced on you , you can decline to have one done. and see if you get a place . Your choice. Paying a month upfront and a deposit tells us nothing about you
A credit check will show the applicant has a good history of meeting financial obligations on time and in full. It may also show the opposite , which would make any Landlord avoid handing over the keys to a property worth many thousands of pounds . A good credit history with no CCJs etc means a lot.
A tenancy does have a credit feature. It is standard to pay monthly in advance but a landlord is committed to housing you for the duration of the tenancy period, and potentially time to evict which can be 6-12 months, so even if you pay 6 months rent upfront a landlord would would want to see you have a history of meeting your financial obligations. Landlords cant just evict when you miss your first payment.
I think you’re right that the credit check component of referencing is of limited value to a landlord because it only deals with your history of repayments for credit, which as you say doesn’t really apply. I largely ignore the credit score for this reason. A person who only spends what they earn and doesn’t borrow from people will usually have a very low credit score. What is really required is an affordability check, where the applicant’s monthly income and expenditure are examined to check whether they can really afford the property. Referencing usually includes a crude calculation of affordability based on income as a multiple of rent, but its left to the landlord to do a more in depth analysis if they wish, and some do. So what we’re left with is a credit check being used as a rather unsatisfactory proxy for financial viability.
How do you find CCJ s ? I did experience a few years ago before tenant fees regarding referencing,an applicant paid the £40 fee for the credit/reference check and it exposed 3 ccjs. He rang me to ask why I hadn’t progressed his application, when I told him it was because of his poor credit history and Ccjs he had no answer, just said ‘Oh…okay’.He maybe thought I would just pocket the fee and.not proceed with the checks . I feel a credit check is well worth carrying out although now the rules on who pays for the checks has changed I carry out thorough screening and face to face conversation before the credit check stage.
If someone told you that, they were lying. It’s just one piece of the puzzle and a minor piece at that.
I always ask applicants the first time I speak with them whether, if I run a check, I’ll find anything. I tell them that finding something doesn’t automatically disqualify them (we’ve all made mistakes). However, if they tell me I won’t find anything and I subsequently do, I tell them they’ll be disqualified immediately. Not because of the credit issue, but because they have compromised trust …
… and trust (both ways) is the be all and end all of an application.