Leaseback and sale schemes to be regulated
23/10/2007
The Council of Mortgage
Lenders are calling upon the Treasury
to let the FSA regulate sale-and-leaseback schemes, simply to
offer better protection for consumers.
Sale-and-leaseback schemes give a chance to owners to sell their
properties to a firm and then stay in the property by leasing
it back. It has been stated that many firms are offering security
of tenure, and homes are often brought at a special rate without
an independent valuation.
CML director general, Michael Coogan commented: "Controls exist
for action taken by mortgage lenders when customers are in arrears.
"The government needs to consider urgently whether regulation
of sale-and-leaseback schemes by the Financial Services Authority
is appropriate because it would provide protection for potentially
vulnerable consumers."
A member from the firm stated that the actions of some companies
offering 'sale-and-lease back' schemes amounts to daylight robbery,
causing a number of people financially ruined and with out accommodation.
Mr Coogan added, "Our Government must urgently introduce regulation
to stamp out this unscrupulous practice, which is cashing in
on people's financial problems and deepening their misery."
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