A brains trust called the Resolution Foundation recently published a report that suggests the UK faces a rental retirement timebomb unless more people are helped onto the property ladder today.
It says if nothing changes, too many of today’s 20-something tenants will be renting when they retire, and that the government will face a 50% bigger housing benefit bill when they stop working during the 2060s.
And less than half of Millennial retirees will own their own home when they quit work, the report warns.
Yes, some young people may inherit wealth off their parents, but the foundation says this won’t stop many being frozen out of the housing market as the gap between pay and prices widens and deposits get bigger.
A key factor is overlooked by the report, though. And it’s called creditworthiness.
Just because young people are struggling to get on the property ladder now doesn’t mean they will always do so.
At CreditLadder we believe that a revolution is under way for tenants keen to get on the property ladder.
Although they will still have to save up a deposit, borrowers will always need a decent credit history on top of a deposit to get access to the best mortgage deals.
Improve creditworthiness
Which is why CreditLadder was born. To help tenants add their rental payments to their credit histories, and boost their creditworthiness.
And we’re not alone. As well as Big Issue magazine founder Lord Bird’s Creditworthiness Bill progressing through the Lords, the government is also spending £2 million to kick-start another wave of innovation and investment in tech that will help renters get on the property ladder.
And we’re part of it after winning a place among the final six tech firms picked to develop a digital solution to the nation’s creditworthiness challenges.
It’s these kind initiatives that we believe will mean soon more tenants will be given a realistic leg-up into home ownership.
Remember, CreditLadder can help you improve your credit score.
CreditLadder can improve your credit position by reporting your rent payments. CreditLadder is the first way to improve your credit score and position across all three of the main Credit Reference Agencies in the UK, namely Experian, Equifax and TransUnion. Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this can also help save you money. CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.
Remember the content provided in this article is for information purposes only and should not be considered as advice.