Applying to rent a property can be challenging if you have a poor credit history and in particular, if you have a court judgement registered against you. After all, failing to meet your previous financial obligations could indicate that you might not meet your future obligations including rental payments. However, having a poor record should not automatically disqualify you from renting, but it might require you to “jump through a few more hoops” to make a successful tenancy application.
Remember that almost every letting agency will run a credit check on applicants, therefore any adverse credit history will probably be identified as part of the application process. If you are concerned about your credit history, we suggest some practical steps below that you can take to give yourself the best chance of making a successful application.
Understand your credit fie
If you are concerned that you might have a poor credit history, then you should check your credit file to understand what information is held about you. In the UK, there are three credit reference agencies – Experian, Equifax and Transunion. You have a statutory right to check the information held by each credit agency. Click on the following links to register and access your records;
Correct any errors
If there is any information held on file that is wrong, then seek to have it corrected, especially if it is likely to be detrimental to your rental application. As identify theft is increasingly common, you should also check for any fraudulent activity on your file to ensure that your credit rating is not impacted by somebody else using your identify. If there are any errors on your file, then you should write to the credit agency and ask that they be corrected.
What to do about a County Court Judgement (CCJ)
Adverse credit data, including any CCJ’s will stay on your credit file for six years. If you paid what you owed under the CCJ within 30 days of the judgement, it should not appear on your file. If there are any mitigating circumstances to the CCJ, then write to the credit agency explaining what happened and ask them to make a note on your file.
Be upfront and disclose any issues you know about
It is far better to be “up front” and disclose any issue you know about to the letting agent ahead of a search being undertaken. Being open and honest and explaining the circumstances that led to any credit issue will probably help your application. If you do not disclose something you know about and the issue is identified during the search, it might appear that you tried to "cover it up" .
Ask your current landlord to provide a reference
If your current landlord is willing to provide a reference stating that you have consistently paid the rent and all of the bills on time, then this should go a long way to providing the letting agent and your future landlord with assurance that you will be a reliable tenant.
Provide a guarantor
If you are able to provide a guarantor, this will almost certainly improve your chances of making a successful application. A guarantor is someone who agrees to pay the rent on your behalf in the event that you fail to pay it. Your guarantor will need to pass a similar credit check and will be required to be a party to the tenancy agreement.
Offer to pay the rent up-front
If you can afford it, paying six months rent in advance will remove any concerns about your credit worthiness during the period of a normal Assured Shorthold Tenant (AST) agreement. However, keep in mind that you will likely have to continue to make six monthly payments in advance at the AST renewal date until your landlord becomes confident that you no longer represent a credit risk.
The most important thing to remember is that you should be honest and communicate the reasons leading to any adverse credit matters. Most landlords understand that people can fall into financial difficulty, especially where there are mitigating circumstances such as a loss of a job, a change in family circumstances or a period of prolonged illness. Also keep in mind that a successful application is not just based on your credit history but takes into account your current financial position, how you present yourself to the agent/landlord and your ability to provide a previous landlord reference.
If you want to make a rental application but have concerns about your credit history, then please contact us. We are here to help.
Want to know more?
Learn more about the process of applying to rent through Aspire, please see here:
Read the answers to questions we are frequently asked by tenants.
Learn more about your responsibilities as a tenant.