Sell Home And Rent Back – Questions of Affordability
Although the FSA is now fining lenders who have given out mortgages irresponsibly, it still leaves thousands of homeowners in a financial mess with few options left, aside from a quick house sale, sell home and rent back scheme or the threat of losing their real home. The FSA say that although it is hoped irresponsible advice and lending is rare, evidence suggests it is a ‘serious and widespread problem’.
Currently there are over 100 potential cases of mortgage fraud, with 17 mortgage brokers banned for fraud already this year. It is no wonder more homeowners are left seeking a sell home and rent back scheme as debt takes over.
Sell And Rent Back Helps Maintain Lifestyles
Recent studies show that the middle classes are aware of the difficult times ahead, with three out of four homes earning over £30,000 saying they will rein in their spending, according to a study by a leading insurance company. Although they may have above average salaries, a sell and rent back scheme may be a consideration for some weighed down by high lifestyle costs. At one point, many could treat their real homes as a cash point, remortgaging and releasing home’s equity to fund any shortfalls in income. But now the cost of debt is expensive and remortgages are harder to secure, leaving many households with hard decisions to make as they struggle with debt. It is been estimated up to ninety mortgage deals a day are currently withdrawn. Some may have no choice but to choose sell and rent back scheme.