What credit score is needed to rent a property

Renters
Your Money

What credit score is needed to rent a property

After hunting out the right property and negotiating the rent, there’s one final hurdle to overcome - getting the documents and checks in order. And that’s where the credit score comes into play.

Landlords and letting agents want to make sure that the next tenant is financially stable and able to pay the rent on time.

The most reliable way to do this is by running a credit check, which enables them to find out information such as previous bankruptcies and debts, as well as rental history. All of these details add up to make your credit score. A good score could indicate that you’re good with money, and therefore a good choice of tenant. A bad score on the other hand, might cause you some problems.

From how to find out your credit score, to what you can do to improve it, and what credit score is needed to rent a house or a flat - we’ve got you covered.

How to find out your credit score

In the UK, there are 3 major credit reporting agencies that give you a credit score: Equifax, Experian, and TransUnion. It’s simple to find out; just visit their website, and after a few clicks and details you’ll have your score. This is also where the landlord can run the credit check.

The landlord must get permission from you beforehand; this is either rolled up into the tenancy application, or you’ll be asked to sign a separate document. The cost of the credit check is usually included in the application fee.

You are not legally required to agree to a credit check, but without one a landlord might not feel confident in leasing you the property.

The credit report includes information such as;

  • Your full name
  • Your current and former address
  • The Electoral Roll register (this verifies that you are legally registered to an address, and therefore have a right to live in the UK)
  • County Court Judgements
  • Administration orders
  • Bankruptcy

What credit score do you need to rent a flat?

It’s a bit of a grey area in terms of the minimum credit score needed for renting in the UK. There’s no exact number, ultimately it’s up to the landlord to decide. However, most landlords would require at least a “good” credit score when renting a house or a flat in order to consider you as a reliable tenant.

There isn’t a universal scoring system for Equifax, Experian, and TransUnion, so the numbers can vary slightly. However, they all have 5 bands of ranking that range from the lowest - “very poor”, to the highest - “excellent”. Each agency scores you separately. As you won’t know which one the landlord will use, they’re all equally important.

How to increase your credit score

Before applying to lease a rental property, you can be proactive and work to increase your credit score for renting.

First, get hold of your credit report from Equifax, Experian, and TransUnion; you can get one free report from each agency a year. Then, go through the details - is one significantly lower than the others? It might be that there’s an error in the report. Dispute the inaccuracy and it should get fixed.

Secondly, do you have any outstanding payments? If so, pay them as soon as possible. A history of overdue payments can lower your credit score. You could set up a direct debit to keep on top of monthly phone and utility bills.

If you don’t have much of a financial history, this could also affect your score. This is often the case for students, who haven’t (yet…) racked up much spending. Credit cards and student credit cards can be a good way to start building up your credit score. But, always make sure you are confident that you’ll be able to meet your repayments before signing up and spending.  

And finally, if you’re not already registered to vote - do it! This puts your name on the electoral roll and helps to verify your identity. As a result, you’re then seen as more ‘stable’ so it boosts your score.

Check out our 8 money saving tips for renters here.

What to do if you have a poor credit score

Landlords don’t want to end up with tenants who miss rent payments, fall into debt, and have to be evicted. A low credit score (and especially if there’s bankruptcy or insolvency on your record) could suggest that you might struggle with paying rent on time, which is a no-go for a lot of landlords.

However, it’s not necessarily a deal-breaker. You might be able to come to an agreement if you have another way of showing your ability to consistently pay rent.

You could….

  • Have references

A written reference from your boss or a previous landlord could really help your case. If you have their permission, include a phone number too.

  • Demonstrate your financial stability

Bank statements and proof of employment could help show this. Could you offer to pay a larger deposit, or three months rent in advance, rather than just one? Could you have a guarantor? They are often required for student tenancy agreements, to make sure there is someone else (normally a parent or close relation) who could cover the rent if necessary.

  • And always be honest

Try to have a conversation with the landlord about your financial history. If you’ve overcome a tough few years, can you show what you’ve done to improve your financial health.

All’s well that ends well

Whether you have an excellent credit score or a poor one, it’s ultimately up to the landlord to decide to accept you as the new tenant. However, a strong score will put you in the best possible position, and you can always work to improve it.

So, stay on top of your payments and make sure you’re registered to vote. Who knows, you might just land that dream property after all…

Along with the credit scores to rent apartments, be sure you have all your documents ready for the landlord or letting agent to check. Check out 'what documents do I need to rent a flat?' For more details.

Other blogs you might be interested in:

How to keep on top of your bills in a shared house

12 easy ways for renters to reduce their utility bills

Contents insurance comparison: our ultimate guide