Brighter days are coming for those who are looking to climb the property ladder in 2018 since the British Government has announced a plan for a renter’s application.
The Rent Recognition Challenge is a £2 million competition, powered by the government to develop applications that help renters boost their credit scores, access credit and get on the housing ladder. By this, public officials hope to attract young entrepreneurs that will build a comprehensive app and help up to 11 million people.
Developers are welcome to build an app from scratch or to build on to an existing one to enable rental tenants to record and share their rental payment data with lenders and credit reference agencies.
The Challenge, which is a part of the Autumn Budget 2017 aims to gradually eliminate the inequalities in the UK housing market. Tenants should be able to have proof of meeting their rent payments on time to increase their credit score.
The app is set to recognize a good credit score through rent payments to boost the tenants’ profile during mortgage affordability assessments.
According to Stephen Barclay, the Economic Secretary to the Treasury ‘People’s monthly rent is often their biggest expense, so it makes sense for it to be recognized when applying for a mortgage. Without a good credit score, getting a mortgage can be a real struggle.”
‘Most lenders and credit reference agencies are unable to take rental data into account because they don’t have access to it. The Rent Recognition Challenge will encourage firms to develop an innovative solution to this problem and help to restore the dream of home ownership for a new generation,’ he added
The competition will open to applications in early 2018 with the closing date in March 2018. Development will run from April 2018 to October 2018.
Learn more about the Rent Recognition Challenge here.