Tuesday, Oct 23, 2007
These guys are no better than Loan Sharks and need taming
Firstrung: Calls for the FSA to regulate house sale and leaseback schemes
The Council of Mortgage Lenders, Citizens Advice and Shelter are calling upon the Treasury to allow the FSA to regulate sale-and-leaseback schemes, in order to provide greater protection for consumers. In a letter to the Economic Secretary to the Treasury, Kitty Ussher, the organisations expressed concern that some of the schemes may not be treating consumers in a fair manner.
Posted by converted lurker @ 10:37 AM (388 views) Add Comment
8 Comments
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1. yoyo1 said...
I have heard that some of these schemes are led by a consortium of buy to let folk.They obviously become much more ruthless when they operate in gangs! It's sad that some home owners go down this route, they must be desperate.
2. confused76 said...
CL,
I do not have any problem with these schemes.
Also these property sales are recorded at actual values, so it will mean a faster price drop in market stats.
In any case these schemes will not be profitable for the current glut of rental properties on the market, so more bankruptces and repossessions later on. All very very welcome.
Can please close with my landmark laugh
Ah ahahhh ahhhha hhhhha hahah u ahha uahahhahha
3. crash bandicoot said...
I too have no problem with these schemes, they are only filling a gap in the market. Let's be honest if you have screwed up so badly that you need to sell to these folks what other choices do you have? How you ended up in such a mess in the first place is more to the point - blame the organ grinders not the monkeys.
4. Ben said...
Some of these schemes are definately dodgy. I've heard of some that give the sellers a contract that say they can stay as tennants indefinately with the rent being X percent below the makret rental value... however apparently these contracts are only valid for 6 months at which point the new owners either kick them out or put the rent up to the full market value (Or above!).
However, are all these schemes bad? If someone is about to be repossessed and lose everything, then wouldn't it be beneficial to them to sell at 15% below the market value and get some money, rather than get repossessed and lose everything?
Remember too that if the seller opts to stay in the house and pay rent then the landlord is renting to a high risk tennant, i.e. someone that has a history of not paying their bills.
In my opinion this area should be regulated for fairness and not shutdown completely. What do you think?
5. su said...
Ben. I think you raise some valid points.
In any contract both parties should benefit and people who are of below average intelligence or have fallen on hard times should not be taken advantage of.
These tenants may be high risk, but as long as they continue to pay the rent, is it really fair to kick them out after just 6 months? If there has to be a time limit, wouldn't a couple of years be much fairer - especially if the tenants have lived in the property for many years?
I agree with Ben that these businesses should be regulated for fairness.
Everyone has to live with the consequences of their actions, but who wants to live in a world where there is no compassion?
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