UK Sale Leaseback Foreclosure Rescue Operators Form Trade Association To Raise Industry Standards

In the United Kingdom, The Press Association reports:

• A new trade association for sale-and-rent-back companies was launched this week in a bid to raise standards in the industry. The Property Buyers Association (PROBAS) sets out a strict code of practice that all members have to sign up to, which aims to increase the transparency of the schemes and give consumers greater assurance. Under the terms of the code, members must provide people with key facts about the scheme in line with City watchdog the Financial Service's Authority's policy on treating customers fairly.

• Sale-and-rent-back companies buy the homes of people who are in danger of having them repossessed and then rent them back to them. But the rapidly growing sector has come in for some bad press, with claims that some companies pay less than 60% of the market value for properties, while others levy steep rent increases and some evicted people after just 12 months. Citizens Advice has branded the schemes a "disaster waiting to happen" and called for the sector to be regulated to help protect vulnerable consumers, while the Council of Mortgage Lenders has also expressed concern about the companies.

For more, see Rent-back firms launch trade body.

Go here for the Property Buyers Association's established PROBAS Code of Practice (go here for pdf version).