Finding a Mortgage Offer After Rental Arrears
Trying to get into the property ladder with a history of rental arrears can be extremely frustrating. Credit issues can remain on your file for years, and so you might find that arrears from several years ago continue to make it hard for you to find mortgage approval.
Here we'll explain how rental arrears can impact your mortgage application - and what you can do to improve your chances of mortgage approval.
If you have been turned down for a mortgage, or want to check out the most competitive rates on the market, give the Revolution team a call on 0330 304 3040 or drop us a message at [email protected].
How Do Rental Arrears Impact my Credit Report?
Landlords may record your rental remittances and forward the history of those payments to the credit referencing agencies. In most cases, this system is designed to make it easier for tenants to build up a credit score and improve their ability to find a mortgage.
The Rental Exchange Scheme was set up in 2016 and means that landlords can include private rental payments in your credit file to prove a history of reliable payments.
Not all landlords are part of the scheme. For those that are, you pay Credit Ladder directly; they record the transaction and pass the cash onto your landlord.
Another aspect of this scheme is that it assists landlords who struggle with non-payments from tenants. Therefore, they can run a credit report and see if new tenants have repeatedly fallen behind with their rent before.
If you have fallen into rental arrears, it may show on your credit report when applying for a mortgage if you rent from a landlord who is part of the scheme.
