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Credit reference agencies are to appeal controversial court ruling

  • 09/04/2002
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Credit agencies are struggling to obtain client details from the electoral roll

People moving house this year could face difficulties when applying for a mortgage because credit reference agencies do not have their details registered from the electoral roll.

A landmark ruling against a local authority last year ‘ where Brian Robertson won the right to ensure Wakefield Council does not divulge his electoral roll information to corporate companies, following an influx of junk mail ‘ has resulted in credit reference agencies being barred from gathering up-to-date information on clients. The ruling was made under Article 14 of the EU Data Protection Directive.

Although credit reference agencies will be able to keep information they already hold, they are currently unable to access new information.

An appeal is being made before a universal ruling is enforced. However, in the interim this means accurate information on recent home movers and people who are turning 18 is unobtainable by lenders.

Barry Conroy, director of Equifax, said: ‘We maintain that it is vital for us and our lender customers to have access to the electoral roll for the purposes of preventing fraud. Our expert legal and political teams have entered discussions with the Government to bring clarity to this point.’

Tim Dawson, managing director of Mortgage Express, said the ruling could add cost to borrowers.

‘We rely on electoral roll information when assessing applicants. If we can no longer access this information, we will have to source it in other ways ‘ this will add cost to the process and ultimately to the borrower,’ he said.

Discussing the issue in a feature appearing in the ‘First- Time Buyers Focus’ section in this edition of Mortgage Solutions, Ray Boulger, senior technical manager at Charcol, said: ‘Over recent months, we have noticed a growing number of borrowers ‘ many of whom are first-time buyers as they tend to be more mobile ‘ incurring problems because credit agencies do not have their details registered.’

Lenders that offer instant online credit checks are also feeling the effect of the ruling.

Ian Jeffery, sales director at Intelligent Finance, said: ‘This is a problem for new consumers. If we have no access to the electoral roll, we have no way of confirming their residence,’ she said.

Susan Knight, spokesperson for Cheltenham & Gloucester, said the lender expected the problem to unfold more seriously over time.

‘At the moment it is only affect-ing a small minority of borrowers. However, if the ruling is made permanent it will start to affect more and more customers as information held becomes increasingly dated,’ she said.


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