Creditworthiness becoming more important for tenants | Fin24

Creditworthiness becoming more important for tenants

Jul 18 2017 17:36

Cape Town - In South Africa’s highly competitive rental market properties are in high demand and short supply.

With economic uncertainty and the rising cost of living placing pressure on consumers, many have put their homeownership aspirations on the backburner and are opting to remain in the rental market for the meanwhile.

As a result, demand in the rental market has continued to increase, making it more and more difficult for tenants to find a suitable rental property.
Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa, says the competition for rental property coupled with changes in legislation has led to landlords and rental agents scrutinising each potential tenant, which has also made it harder for tenants to find a rental property.  

“The Prevention of Illegal Eviction and Unlawful Occupation of Land Act (PIE) and the Consumer Protection Act (CPA) have made it more difficult to evict tenants, even those who default on the rental payment. As a result, landlords and management agents have introduced more stringent screening criteria to ensure they select the right tenant from the start.

In today’s market, the creditworthiness of a tenant has become more important with landlords starting to check credit reports to establish whether the potential tenant has a clean credit history,” says Goslett.
According to Goslett, a favourable credit score and clean credit record is a valuable asset when applying for a rental property. Each year consumers can obtain a free credit report from the credit bureaus within the country to assess their financial position.

It is advisable for tenants to know their credit score and check your credit record for any inaccuracies.  
Tips to avoid adverse information on your credit history:

- Read all clauses before signing a contract with a creditor;

- Make regular payments to a creditor by the 7th of each month;

- Keep a list of all creditors, the basis of credit and amount to be paid;

- Keep a record of all payments made to creditors;

- If you relocate, notify all creditors of the change of address;

- Attend to all correspondence from creditors or their legal representation.

Tenants can get a free credit report from the following sites:

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remax  |  money  |  property  |  rentals


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