Which? has welcomed FSA action to protect consumers from ‘shoddy’ sale and rent back advice.
The Financial Services Authority (FSA) has investigated the sale and rent back market, publishing a damning report showing most sale and rent back (SRB) plans were either unaffordable or unsuitable and never should have been sold to consumers.
Redress must be paid for poor sale and rent back advice
As the FSA has temporarily closed the market, Which? chief executive, Peter Vicary-Smith, commented: ‘It’s welcome news that the FSA has taken action to stop people falling prey to shoddy advice from sale and rent back firms.
‘Which? exposed the shortcomings of this market last year, after our own investigation uncovered woefully inadequate advice. This is exactly the type of strong, proactive action we’re calling for from the new financial regulator in our “Watchdog not Lapdog” campaign.
‘We now want to see redress for those consumers who have been given poor advice by SRB companies, and for this to happen quickly.’
What is sale and rent back?
If you’re facing repossession, sale and rent back firms offer to buy your home at a discounted price, allowing you to remain in the property as a tenant.
However, not only could you receive far less than your home is worth, most sale and rent back operators offer no rental guarantees beyond a standard assured shorthold tenancy period, so you may still have to move out sooner that you’d think.
The Which? ‘Watchdog not Lapdog’ campaign
Which? wants a financial regulator that acts as a consumer champion. Our Watchdog not Lapdog campaign calls on the government to make the Financial Conduct Authority (FCA) a strong ‘watchdog’ and not a weak ‘lapdog’ when it takes over from the FSA.
- Sale and rent back explained – how SRB works and why you should avoid it
- Which? Watchdog not lapdog campaign – pledge your support for a strong regulator
- Which? Money Helpline – if you’re at risk of repossession, our money experts can help