Sale and rent back firms will have to register...

05 June 2009

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Written by rosalind renshaw

The Financial Services Authority is getting ready to fulfill its promise to clamp down on rcontroversial sale and rent back schemes, by introducing a new, interim regime on July 1, to tackle the worst abuses.

The schemes buy property at a discount from debt-laden sellers who are often facing repossession, and then rent their home back to them.

There have been horror stories about people being evicted from their homes after a short while, or being forced to pay higher rents than they had been led to believe. The sale and rent back industry is so far totally unregulated.

The new regulation will be implemented in two stages, with the more comprehensive regime starting on June 30 next year.

Under the interim regime, from this July 1 firms will need to meet conditions including a requirement to be run by fit and proper people. Firms will also need to apply for interim permission to carry on trading.

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