Glossary: Sell-and-rent-back schemes

Sell-and-rent-back companies buy people’s homes for less than the market value (typically 70%), paying all fees and costs and then rent the property back to the original owners. For many householders with debt problems facing repossession, this seems like a good idea as they can use the cash to settle any existing mortgage and outstanding debts, while remaining in their own home. Allowing for selling the property for considerably less than its market value, the major disadvantage surrounding sell-and-rent-back schemes is that they are completely unregulated, so there are no guarantees about the security of tenancy or the cost of the rent.

Relevant to: Buying

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