Latest Debt News
Sell and rent schemes 'should be reviewed'
09/07/2008 17:37:00
Sell and rent back schemes should be reviewed as many people cannot meet their mortgage repayments, according to a money expert.
Fool.co.uk says the schemes, which allow people to sell their property to a firm and then rent it back from them, are often used as a fast fix when people cannot meet mortgage repayments.
The website adds that many customers do not understand the full contract, as over a quarter believe they will be able to stay in their homes for as long as they like.
Research from the firm also found 41 per cent think they have the usual tenancy rights and one in six expect to receive the full market value for their home.
Donna Werbner, a property expert for the firm, said: "The allure of such schemes to people facing repossession is understandable. However, I would urge anyone considering doing this to do their research.
"Much of the information out there is misleading and by the time you find out the truth, it could well be too late to change your mind."
The Times recently reported over four million homeowners have chosen to take on extra loans to cover mortgage or rent repayments in the past year.
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