Credit score for renters among support measures coming: PM
VANCOUVER — A federal government announcement that rental history could be used on a credit score is a “gamechanger” for those who have been faithfully paying their rent for years, said a longtime advocate of the idea.
Jackee Kasandy, CEO of the Black Entrepreneurs and Businesses of Canada Society, said getting funding from banks remains a challenge for longtime renters like her, unlike homeowners who can put up property as collateral.
“I’ve rented successfully for 20 years. Why doesn’t that count?” Kasandy said. “I’ve always asked that question.”
Prime Minister Justin Trudeau announced the plan Wednesday, along with other supports for renters, including a renters protection fund and a bill of rights.
He said there’s something fundamentally unfair about paying $2,000 a month for rent, while those paying the same for a mortgage get equity and build their credit score.
“Renters matter, and young Canadians put a lot of their hard earned money toward rent. We think that should count,” he said at the announcement.
Trudeau told a small crowd at a Vancouver community centre that the government wants landlords, banks and credit bureaus to make sure rental history is taken into account. “This will make it easier to qualify for a mortgage or even qualify you at a lower rate. And just think about all the other things that will come from having a better credit score; a loan to help you start a small business for example,” Trudeau said.
Kasandy said she realized that she and many other immigrants to Canada don’t own homes but end up paying a big portion of their incomes on rent.
“That should count for something and it hasn’t counted for anything,” she said. “It’s fantastic news for all of us really,” she said of the announcement.
The measures announced are part of next month’s federal budget and include a $15-million Tenant Protection Fund, which would pay provincial legal aid groups to help tenants against unfairly rising rents, “renovictions” or bad landlords.
The Canadian Renters’ Bill of Rights would also need partnerships with provinces and territories to require landlords to disclose a history of unit pricing and create a national standard for lease agreements.
Rob Patterson, a legal advocate with the Tenant Resource and Advisory Centre in Vancouver, said he is “most intrigued” by the promise of a bill of rights for renters.
“The biggest way to prevent the continuing rent gouging that we’re seeing in the market is, first off, to make sure people aren’t getting unnecessarily evicted,” he said in an interview Wednesday.
Finance Minister Chrystia Freeland was also at the event and said a no-holds-barred plan in the upcoming budget will help young Canadians “wrestle down” the cost of owning and renting a home.