Renters uneasy after new federal bill aims to tie rent payment to credit score

Both landlords and tenants say this change could have unintended consequences for cash-strapped people

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By ANNABEL BESSEM and ALYSSA GLENN

An international student from Nigeria who was evicted from his Vancouver home a few months ago is skeptical about the federal government’s proposal to tie credit scores to rent payments.

Both the federal and provincial governments recently announced plans to strengthen protections for renters. Among the proposed changes by the federal government which will be unveiled in its budget later this month, is a proposal to see credit scores improved by paying rent on time. The aim is to help young renters become eligible for mortgages and break into the housing market.

Zayyan Shaibu, an accounting student at Langara College, said checking a credit score is no better than a college GPA score because “it  doesn’t tell the full story.” He said it is “not a good idea to factor rent into credit score decision making.”

Credit score risk

Peter Thanas, a Vancouver landlord, said the connection between rent and credit scores could be a “disaster for the lower end market tenants.”

He said marginalized renters need “real and true support, and they probably need additional subsidies that are realistic and that are sensible and relative to current market costs.”

However, he said tying credit scores to rent could be beneficial to landlords dealing with difficult tenants.

“If a tenant who becomes predatory towards their landlord and doesn’t treat their landlord with an appropriate amount of etiquette or respect, then, yeah, as a landlord, I probably would report them [to the credit bureau],” said Thanas.

Other measures introduced by the federal government last week included a $15 million fund for legal aid and tenants’ rights advocacy groups and creating a Canadian Renters’ Bill of Rights that would require landlords to be transparent about past rental prices. The federal government also promised a national standard lease agreement and a crackdown on renovictions.   

Provincial Housing Minister Ravi Kahlon said in an email statement to the Voice that B.C. welcomed the initiatives by the federal government.

“The idea that someone can use their rental history as part of their credit score will help many people in our communities who have trouble getting their credit scores up, particularly new immigrants who arrive and have zero credit score.”

Renter realities

Shaibu said when he was evicted from his home, he “just pretty much got kicked out of the place.”

He said the landlord needed “to do some ‘air quotes’ renovations.” But he doubts that was the reason.

“You know, essentially, he wanted to get in fresh new students … then he could now increase the pricing.”

The provincial government introduced yesterday changes to the Residential Tenancy Act it hopes will reduce evictions, speed up rental disputes and restrict rent increases if a tenant adds a child under 19 to the household.

Spencer Chandra Herbert, NDP MLA for Vancouver-West End, and the premier’s liaison for renters in the Vancouver area, said the legislation will benefit landlords as much as it helps renters.

“I do think the provincial legislation that we introduced today will actually help support landlords to rent out homes more than they are now, because it’ll give them greater certainty around dealing with things like late payments with tenants that are problematic, giving them greater security around those issues so they can feel confident renting their homes out,” Chandra Herbert said.

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