Homeless charity to trade tenants personal data?
Today it has been revealed that social landlords are planning to hand over rental payment data to a credit ratings giant, in an attempt to help social tenants build their credit histories and access more affordable housing.
Later this month Experian and the social investment arm of The Big Issue “Big Issue Invest” will be launching the national scheme – where Experian will collect data, including tenant’s names, addresses and history of rent payments to create a real-time rental database that will aim to establish or improve a tenants existing credit rating based on their track record of regular rental payments.
With some of the biggest housing associations (in England) on board, the plan is to use the free service to help tackle loan sharks and doorstep lenders by making these details readily available to social landlords and lenders.
Big Issue Invest have said the scheme will improve credit decisions for the 30% of social tenants without a rating, and would also benefit the remaining 70% who do have one. It should not reduce credit ratings of tenants in rent arrears.
Sarah Forster, director of development at Big Issue Invest, said: ‘I hope this is scaled-up nationally so all tenants can share data. Using rental payments data could be the credit scoring method of the future for social tenants.’
Landlord Referencing Services welcome the principal behind this idea, but also have grave concerns about how this will affect private landlords (and their tenants) further down the line.
As a tenant referencing company ourselves (that has been around for 3 years now) we have a clear understanding of how large credit conglomerate’s work; via automated computer systems, which are clearly not geared up to be on a “one-on-one” basis.
LRS do not think this is at all helpful (or morally acceptable for that matter) to carry out a data collection exercise that is hidden behind the premise of helping social housing tenants avoid debt ( what with the impending welfare reform via Universal Credit ) – when in the cold light of day we believe it to be an exercise in gathering data to enable the likes of PC World and RBS to lend tenants on benefits more money.
Local authorities should be using Lifestyle Tenant Referencing primarily to help their local communities, instead of gleaning private and sensitive data to sell on to third parties so that their tenants can buy plasma screen TVs!
LRS is also fairly surprised that a giant such as Experian has taken on a journalistic magazine sold by homeless people as its first choice of partner – a cost cutting measure or a political statement? We’ll let you be the judge of that.
There is also the massive issue regarding Data Protection.
Databases containing tenants rent defaults are obvious advantageous to landlords – but what database can store whether your applicant tenant is a drug dealer or illegal immigrant? None, and for the simple reason that this does not comply with The Data Protection Act 1998. The LRS database is the only one of its kind that can tell you these types of things without breaking data protection rules – simply because we put landlords and letting agents in touch with one another to find out what their applicant tenant is really like.
This is where Lifestyle Referencing at LRS is completely different. It is not about big databases being used for financial gain but about databases being used for specific purposes. At LRS we have created a community of pro-active landlords and letting agents to simply protect one another from rent arrears, property damages, anti-social behaviour, illegal subletting, criminal activity, and so on. Our Lifestyle Referencing systems are manually data-controlled, as we fully understand the importance of direct personal contact with our vast community of property professionals.
Furthermore, we pledge to never sell on any of our data to conglomerates in order to sell it on to banks. LRS may not be a giant but we do have a moral soul.
Lifestyle Referencing at LRS is principally about encouraging better understanding, communication and relationships between Landlords/Letting Agents & their Tenants at the lowest possible cost, and not about lining the pockets of the likes of “Fred the Shred” with his £10 million pension or making a political statement for the sake of enhanced media attention.
Our main point being; social housing tenants did not provide their personal data for it to be used for the purposes of giant conglomerates selling it on by using “back door” pretence via a homeless charity smoothing the way for them.