The NLA said it was in consultation with a number of bodies, including the Council of Mortgage Lenders and the Office of Fair Trading, to construct an agreement establishing standards within the sale and rent back market, with the potential for it to develop into a wider regulatory framework.
The body believed it would help improve the image of the sector, which has been blighted by stories of rogue operators, and give consumers greater security when choosing a sale and rent back product.
Steven Hilton, media relations manager for the NLA, said: “Sale and rent back is a type of product which is only right in certain situations.
“But, in the same way as something like equity release, it has its place. What we are trying to do is help create a cleaner sector by publishing a code of practice, with the potential for this to be a stagepost onto a wider regulatory system.”
Hilton insisted that there were many players who were doing good work in the sector but it was being held back by a number of rogue operators who were giving it a bad name.
Speaking as part of this week’s French Connection, Andrea Rozario, director-general of Safe Home Income Plans (SHIP), believed regulation was necessary for the sector.
She explained: “I think it would help. I think it would get rid of a lot of charlatans and people thinking they could set up a company overnight and offer to buy your house with no due regards to the safety of that customer.”