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FSA issued new rules on sale and rent back deals

The FSA (Financial Services Authority) has today issued a number of new rules which will form a key part of the future sale and rent back market for UK homeowners. This is an area of the market which has attracted some of the more undesirable salespeople in the financial world and there have been many instances of pressure placed upon homeowners to take unrealistically low prices for their property.

Under the terms of the new rules, hard sell techniques will be outlawed, cold calling will be banned and those who agree a sale and rent back will be guaranteed a minimum tenancy agreement lasting five years. There will also be "affordability and appropriateness checks" to ensure any deal agreed is in the interests of the consumer.

As more and more people are struggling to pay their mortgages in the UK there has been increased demand and increased interest in the sale and rent back market. Even though the vast majority of parties operating in this sector are above board and offer fare deals to their customers, there have been some instances of hard sell and underhand tactics. Hopefully these new rules introduced by the FSA will give consumers more confidence that any deal signed is in their best interest at the time. There will also be a 14 day cooling off period to give consumers time to consider the merits of any deal they have agreed.

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