HM Treasury has published a Consultation Paper entitled Regulating the sale and rent back market: a consultation.
HM Treasury is proposing that companies offering sale and rent back agreements, which may target homeowners facing repossession, should be brought within the scope of FSA regulation.
The Consultation Paper follows an Office of Fair Trading (OFT) market study published at the end of last year, which looked at the impacts of the growing sale and rent back market. The OFT report identified that there are a number of risks to homeowners entering into these arrangements and made three recommendations to the Government, including compulsory regulation, increasing consumer awareness and improving information about housing benefits.
The Consultation Paper is set out as follows:
- Chapter 2 provides the background to the consultation, including the policy responses the Government is considering.
- Chapter 3 sets out the issues considered by the consultation, and the context in which the Government seeks views on the issues arising.
- Chapter 4 outlines the next steps the Government will take following the consultation.
- Annex A presents an impact assessment for the policy proposed in the consultation.
- Annex B presents the draft Statutory Instrument which would extend the scope of FSA regulation to cover the sale and rent back market.
Comments on the Consultation Paper are due by 1 May 2009.
View Regulating the sale and rent back market: a consultation, 6 February 2009