to be worried we might not be accepted to rent?

[loudhouse18]

Hi Everyone

Bit of background...me, myself and DS currently live with DH's parents, have done for the past 6 years but now we feel the time has come to have our own space and get our own place. We're not in a position to buy a home but are more than happy to rent, however, many many years ago both me and DH got ourselves into debt with cards, loans, overdrafts etc - we were young, silly, naive and regret it all the time. We've been together for 19 years and when your so young and get offered this and that we just took it without thinking of the consequences later in life.

We both work full time and have well paid jobs but due to our bad credit (no CCJ's or bankruptcy) are we highly unlikely to be accepted as tenants to rent?

Any advice would be gratefully appreciated.

You need to check your credit score If this was all years ago and you are not in debt now it may be OK.I think the Martin Lewis web site had a basic checker that is free.

If it was all a long time ago and you’ve been ok since, it shouldn’t be much of an issue. Presumably you’ve still been paying for things in the mean time to build up a credit rating - eg, mobile phone contract - so that will help you. I would check your credit rating.

They may still ask for a guarantor, if they aren’t sure about your history, so consider that. Also, there are rules coming into force sometime next year which will stop estate agents from charging the earth for admin fees - you may want to check when those come in and see if you can time your move to avoid them!

I rent privately with a bad credit history, no CCJs or bankruptcy but had had credit card debt and payday loan problems, all paid off now thanks to a debt management plan, when I first moved from houseshare to renting my own flat I was still on my debt management plan.

I was upfront with the agents about my. Credit history, since I expected them to run a credit check so figured no point in lying and hoping that being honest would go in my favour. Fortunately my mum was able to act as guarantor for me on the first flat. When I moved to my current flat, again i was honest about my credit history but they were only really interested in the affordability (on a very basic calculation of rent being less than a third of my gross income I believe). I offered my mum as guarantor but they didn’t need her.

So i would advise being honest, since credit checks will likely be done anyway. If DHs parents have let you live with them for so long, hopefully they’re close enough to be in a position to act as guarantors and trust you to never put them in the position of actually having to pay anything! My mum did have to declare her income and that she was a homeowner, but she was able to do it directly with the agents so she didn’t have to give me her personal financial information.

You'll most likely be fine. Renting is nowhere near the scale of mortgages in terms of vetting your financial history. They will do credit checks but as long as you're upfront about your situation it should be fine. And as you say no CCJ's or anything of the sort. It may be that you're asked to have a guarantor if they're not totally satisfied but as long as you have an income I can't see you encountering any issues.

You can log into Noddle and a few other credit check websites for free.

Do that and check your credit rating. You'll probably find your old debts are 'time spent' or too old to show up, so you should be fine.

When you do rent ask your landlord or the agent if they would mind you using Credit Ladder, it is free to tenants and private landlords. It means you can use your rent to improve your credit score

www.creditladder.co.uk/

Thanks everyone, thats given me peace of mind.

We too are also in a Debt Management Plan, not something we are proud of and we do regret being silly all those years ago. If only we were wiser with money. We never miss our DMP payments. Although the DMP is something we are not proud to have, it has been a blessing in disguise for us because it meant that we have never gotten ourselves in that kind of money trouble again - it was awful.

Credit checks for rental properties only look at public debt records, they don't see your financial details.

So if no ccjs or bankruptcies you should be fine

But be aware you will only pass most credit checks if you can prove you earn 2.5x the annual rent.

I just joined on Credit Score and mine is pretty low at 239 but my DH's is "on the up" at 359. He does have a mobile phone contract which we never miss payment on so that could be why his is on the up.

With a dept management plan and credit scores that low we'd ask for a guarantor.

Should you really be increasing your expenses while you owe people enough to need a debt management plan?

Would it be possible for you to pay a higher deposit? I'm assuming saving will be difficult if not impossible whilst on a DMP, but some landlords will accept 3/6 months rent on advance if you have poor credit and no guarantor.

Yeah a guarantor is an option for us.

Thanks everyone, I do feel better now.

I don’t think rental agencies or their reference partners have access to your debt history. they are not financial institutions. They can just do id check and see if you have public debits like CCJs. So you don’t need to tell them about your DMP, it may as well be another commitment eg a car loan (but in your own budgeting given your bad history you should work everything out to make sure you can afford). They will ask for a work reference.
It’s good you have a guarantor for back up but you don’t need to go in advertising your past.

I don't think I've ever had my credit history checked by agents or landlords, never even occurred to me. All they wanted was proof of earnings in the form of a reference letter from my employer stating my salary (which I've written myself for my manager to sign!) and one other reference, preferably from my previous landlord, but simply a character reference really. Plus the deposit of course. Honestly, I wouldn't worry about it at all. If you've got the money in the form of steady income, they want you!!

They use a formula of rent/salary and as long as the tenant's income is above that threshold they are happy. Ask any lettings agent about it, can't remember exactly now, but something to do with 1/30th times or divided by something else, it's quite simple.

Debt isn't usually a problem as long as you're both working. It's if you're claiming housing benefit they run a mile.

Thanks everyone.

You've been a great help to me.