We’ve been hard at work again here at Beehive HQ investigating which partners and products we can bring to our Marketplace that’ll really help our members buy their first homes. One of our latest launches we’re excited to announce is CreditLadder.
What is CreditLadder?
CreditLadder is the UK’s first rent reporting platform and allows tenants to have their rent payments reported to the four main Credit Reference Agencies in the UK (the people that set your credit score and track your history) - Experian, Equifax, TransUnion and Crediva. To date, CreditLadder has reported over £600m in rent payments, and we’ve partnered with them to introduce rent reporting benefits to our members. Did you know? This is something that landlords and lettings agencies can’t do for you - only a company like CreditLadder can do this. Clever, right? We think so!
As a first-time buyer, you’ll know that a common question is ‘why can’t I get a mortgage when I can pay my rent every month?’ and you might have been doing this for years but still struggled to get approved for a mortgage. This is because rent isn’t routinely recognised in credit reports, so this can potentially make it harder for renters to secure a mortgage.
CreditLadder offers a service that will support your house-buying goal journey by making your rent count against your credit report which could, in time, improve your credit position! By working with CreditLadder, we believe this is just another step that we’re taking to making home buying more accessible to more people, exactly what we want to do.
How can CreditLadder help renters?
The great news is CreditLadder has helped thousands of tenants improve their credit score and credit position and you could be next. Reporting your rent payments could improve your chances of being accepted for a mortgage or loan as, over time, it should improve your credit score with Equifax and TransUnion and could improve your credit position with Experian and Crediva. Your credit position is one of the aspects that mortgage lenders scrutinise when you make an application or even get a Mortgage in Principle. Interested? Sign up in around 5 minutes via the Beehive app!
How does CreditLadder work?
With CreditLadder you can report your rent to one Credit Reference Agency for free or report your rent to the four Credit Reference Agencies for a small monthly or annual fee.
CreditLadder has had a free service since it launched in 2016 that reports your rent payments to one Credit Reference Agency of your choosing. They also have a paid version where you can either pay monthly or annually. Any tenant can sign up to CreditLadder and report their rent to either Experian, Equifax, TransUnion or Crediva. For maximum benefit, and to allow your credit records to be seen by as many lenders as possible and have your rent payments reported to all four CRAs, you might want to look at taking up a paid subscription.
It’s important to have the best credit position with all four, which is why we recommend you report your rent to Experian, Equifax, TransUnion and Crediva. By reporting to all four, you have a better chance of having all your bases covered!
Here’s how it works in three steps.
It can take six to 12 months to see the positive impact of your rental payments being reported although your first rent payment will only take about 6-8 weeks before it appears on your file. This could be perfect timing if you’re a new Lifetime ISA customer, looking to buy your first home – as you’ll need to wait at least twelve months before you can use it; so, it could be a great way of building up your chances of getting a better mortgage as you’re building your house deposit.
- Choose whether you want to report to one Credit Reference Agency (for free) or to Experian, Equifax, TransUnion and Crediva (for a fee).
- You, as the tenant continue to pay your rent as normal to your landlord or letting agent. CreditLadder doesn’t collect your rent payments.
- Each month they will confirm your rent payments have been paid and report this information.
How do I register for CreditLadder?
Simply click through from the Beehive Marketplace on the app to the CreditLadder website, decide whether you want a free or paid for subscription and create your account. We’ll run through their registration steps below.
Is CreditLadder easy to set up?
Yes, CreditLadder should only take a few minutes to set up so it’s simple, really. When you head to the co-branded website via the Beehive app, this is what’ll happen...
- Pop in your details whilst you sign up - answer a few quick questions to confirm your identity.
- Provide your tenancy details so that future rent payments can be reported to the credit agencies.
- Connect your bank with read only access for open banking. CreditLadder are FCA regulated and the open banking technology they use is supported by all major banks.
- Pay your rent as normal.
- CreditLadder will read and identify rent payments through the secure access provided. This information takes about 6-8 weeks to appear on your credit file. They don’t collect your rent.
What’s open banking?
Open banking helps financial services connect banks, third parties like CreditLadder and tech providers to exchange data simply and securely to their customers’ benefit. This means that CreditLadder can match up your rent payments and share this information with credit referencing agencies who’ll then log this on your credit report. You’re in charge of setting this all up so no one will have access to details that they shouldn’t.
Should I report to Experian, Equifax, TransUnion, Crediva or all four?
CreditLadder reports rent payments to the four Credit Reference Agencies in the UK. They recommend that you report your rent payments to Experian, Equifax, TransUnion and Crediva as most lenders work with more than one Credit Reference Agency. So, this can increase your chances of being approved for a mortgage as lenders will see the whole picture of your credit score. Equifax and TransUnion will take your payments into account for your report and score, and Experian and Crediva will note it on your report for any lenders to see.
Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this could also help save you money.
Beehive Money is an introducer to CreditLadder. CreditLadder® is authorised and regulated as a Payment Institute and Account Information Services by the Financial Conduct Authority (the "FCA") under Financial Registration Number 811994. Registered in England under number 10074481, Hamilton House, 4a The Avenue, London, E4 9LD.