It has been an interesting month for sale and rent-back companies with moves to regulate and control this sector going into over drive. In the last blog I talked about the couple who beat an eviction after the sale and rent-back company failed to keep up payments when they took over the mortgage. This seemed a fair and equitable result and now we are hearing that sale and rent-back landlords have less than a month to seek FSA approval to continue trading.
This, in essence, will mean that they must open up their practices to checking by the FSA. They will be required to have an independent valuation of each property done and the customer made aware of it. All this seems like a giant step in the right direction to me. In theory, a sale and rent-back scheme could benefit everyone; it just seems that things were not being done very fairly in this sector up until now. I agree with John Socha, vice chairman of the National Landlords Association, when he says:
“Although sale and rent-back will not stop repossessions, ethical sale and rent-back could be a way for homeowners to remain in their properties but become tenants. Only when sale and rent-back operators are within a more regulated environment can we be confident that consumers will be treated fairly.”.
Regulation is the first step to getting this sorted out and seems to be heading in entirely the right direction.
