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Government waits on sale and rent regulation
16 February 2008
The government has admitted that it is waiting for a report into sale and rent back schemes before deciding if the Financial Services Authority (FSA) should regulate the sector.
Speaking in the House of Commons, Peter Viggers, Conservative MP for Gosport, raised concerns about sale and rent back schemes on residential properties.
However, responding, Angela Eagle, Labour MP for Wallasey, said that in their current format, sale and rent back schemes did not concern credit provision, although the position would be reassessed following a review of the sector.
She said: “Sale and rent back arrangements are property transactions that do not involve the provision of credit, and so fall outside the scope of the FSA’s regime.
The government is reviewing the evidence and will consider options to address any problems where appropriate.”
Peter O’Donovan, mortgage manager at Bestinvest, said: “It would be good if all those operating in the market were reading from the same rulebook.
"There are quite a few quirks with the products and regulation might make it more balanced, and make it easier to advise on.”