Very Quick House Sale

The Office of Fair Trading (OFT) has taken action against twelve companies in the sell and rent back (SARB) market, over statements they made in their advertising.

The OFT asked the firms to substantiate claims made in their adverts or change them.

The resulting action by the OFT has now led to three companies no longer offering the service, six have removed their websites, and a further three have made amendments to their website. Two more have been reported to the FSA.

A judge has today issued a landmark ruling in the sale and rent back sector which could have a major impact in the longer term. The sale and rent back market has become more and more popular as the economy continues to struggle with many homeowners, often in arrears with their mortgages, agree to sell their homes at a discount with the opportunity to rent the property for a predetermined period.

POLICE investigating an alleged sell and rent back scam which has hit 2,000 struggling families in the Northumbria region suspect it could be the largest fraud of its kind.

Northumbria Police are probing North East Property Buyers and Newcastle Home Loans after after a referral from the Financial Services Authority.

The Gateshead firms buy homes from people across the region who are struggling to pay their mortgages and allow them to rent them back.

However, the firms have allegedly defaulted on repayments which has led to hundreds of repossession orders.

The Government is offering some hope for victims of ‘sale and rent back’ scheme.

We revealed how tenants who sold their homes to a string of companies, includingHome Assured, North East Property Buyers and Freedom Property, have ended up forced out of their homes when their landlord is repossessed for not keeping up mortgage payments.

Margaret Beckett has announced plans to give tenants at least two months’ notice in such situations. Currently they could be forced to move within two weeks or less of a repossesssion order going through. Mrs Beckett said:

This is where companies offer to buy your house at a discounted rate but promise to let you stay there as a tenant.

For those struggling to meet mortgage payments or facing repossession, this might seem attractive, particularly as these companies offer quick sales. There are many genuine sale and rent back schemes but some cowboys are taking advantage of vulnerable consumers.

They might promise that you can stay indefinitely in the property but then give you only a standard six-month tenancy agreement. They might promise that rent won’t go up but then increase it by a large amount once the initial period is up. Or they might charge you a large fee upfront, and then disappear.

The number of homes repossessed in the UK rose to 12,800 in the first three months of the year, the Council of Mortgage Lenders (CML) has said.

This was up 23% from the 10,400 in the previous three months and 50% up on the 8,500 in the same period last year.

The CML has predicted that 75,000 homes will be repossessed in 2009, almost double the 40,000 of last year.

But the group has now described this prediction as “pessimistic” and could change its view in the summer.

There are many ways available today to get money to deal with your specific needs. Payday loan is an option to get money in your bank account in not more than few hours. But, these types of loans come with a lot of interest which is the reason why some people don’t like this particular option. Also, it is not possible to use this option if you need a lot of money. That’s exactly the situation when you can actually make use of an option, called “sell and rent back” your home.

What is sell and rent back?

As the number of repossessions goes up, the innumerable options on how to end it are also being introduced to the homeowners. These alternative ways are relevant to each home owner’s situation and you can practice even more than one of these options.

However, there are some of these options that really need to be done together with other ways.

If you think, it is impossible to stop repossession (foreclosure) because of your current financial instability, then, you should be able to go through these options: