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Can a Netflix and Spotify account really help you with a mortgage?

Carl Quist 380 Views

Having a subscription to Netflix and Spotify may benefit young people more than they already do.

Being subscribed to the two might help aspiring home owners get onto the property ladder for the Leeds Building Society due to the new mortgage concept.

Leeds Building Society has joined up with credit information company Experian to link to its free Experian Boost Service.

 

What are Netflix and Spotify?

Netflix is a subscription based streaming services which allows you to watch TV shows and movies on an internet connect device. The streaming service has become a staple in today’s generation.

Spotify is a digital music, podcast and video service that gives you access to millions of songs and other content from creators all around the world.

Heidi Fin – Unsplash

 

How do the streaming services help with mortgages?

Regular debit payments over the last 12 months related to the streaming services can now contribute to credit scores.

Which proves that your financial record reliable and you have the ability to pay back your mortgage at a steady rate.

mollie-sivaram
mollie-sivaram – Unsplash

How did this become possible?

In order to raise your credit score and increase your ‘creditworthiness’ in the eyes of lenders, Experian Boost, a sort of open banking run by credit reference agency Experian, collects a record of regular debit payments that don’t typically appear on your credit file.

Since Boost’s introduction in 2019, lenders haven’t taken its data into account when evaluating mortgage applications. But this changed after Leeds Building Society declared it would begin using Boost from Wednesday, May 10.

What does this mean for young adults?

This new mortgage concept will benefit people looking to buy their first home.

Richard Fearon, chief executive at Leeds Building Society, stated: “This will particularly help younger borrowers, first-time buyers and anyone on lower incomes who face the toughest challenge to prove their ability to repay.”