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Sale and rent back guidelines 'welcome'

Higher standards in the UK rent and sale back sector should be enforced, the National Association of Sale and Rent Back (NASARB) said yesterday.

The comments followed the Office of Fair Trading's (OFT) announcement that it will investigate firms which provide the service - and publish a code of practice for these companies next month.

Sale and rent back works by offering those homeowners struggling to make the repayments for their home loan a purchase price for their property.

Occupants are then allowed to remain in their homes by paying monthly rent.

However, some providers have faced criticism that they offer excessively low prices - and sometimes even evict the customer soon after the deal is concluded.

John Socha at NASARB commented: "We are pleased that the OFT is going to be looking into the practices of sale and rent back providers, the majority of whom provide owner-occupiers with their only opportunity to stay in their home as an alternative to imminent repossession."

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