Which? disgusted by sale and rent-back practices

Consumer watchdog Which? has reported two sale and rent-back firms to the Office of Fair Trading.

Which? researchers contact nine sale and rent-back firms and had dealings with a total of 17 advisers.

It says it uncovered woefully inadequate advice.

Of the 17 advisers, seven failed to discuss whether sale and rent-back was a suitable option for the inquirer.

In one case, a Which? researcher was given a quote that would have left the customer without enough money to pay off their debts. In another, the adviser did not ask how much the customer’s debts were.

The firms that have been reported are Property Locksmith and Rapid Property Group.

Peter Vicary-Smith, chief executive of Which?, said: “It’s simply unacceptable that people are receiving shoddy advice about such a huge financial decision.

“Not only are regulated firms not doing enough to ensure vulnerable consumers make the right choices, some are offering sale and rent-back that aren’t authorised to do so.

“The FSA must tighten the screw on these firms to make sure the rules are followed and consumers are protected.”

Sale and rent-back firms, which typically offer to buy cash-strapped owners’ homes for around 80% of market value, are now regulated by the FSA.