Potential Pitfalls of Sale and Rent Back

Sale and Rent Back can assist home owners in financial difficulty to remain in their home. Unfortunately the sale and rent back industry has grown rapidly and with unscrupulous investors jumping on the band wagon the industry has a poor reputation.

Many home buying companies are property traders not landlords. They believe there is no ethical way to offer a rent back option, so never look to develop a sell and rent back service. Many of them believe that their service offers many of the benefits claimed by sale and rent back without the risk and uncertainty.

What is Sale and Rent back? You sell your home to a company with an agreement to rent it back for a period of time. Potential Pitfalls: Unfortunately the aims of many sale and rent back companies vary from those of the vendor and would be tenant. You should always seek independent advice but there are some common issues you should be aware of:

• After initial rental period the rent is increased, often above market rent. You either pay the increase or move out.

• Company rents for limited timescale usually 6-12 months and then looks to sell the property. This is possible because you only have an assured shorthold tenancy or AST.

• Company goes bankrupt and your home is repossessed. You have limited rights and will end up being evicted • Company passes your property onto an investor. You don’t know who you are dealing with and may end with an unscrupulous landlord.

• Many companies are investors in disguise and may not be able to offer you a quick house sale. They are often small scale, with no proven track record and limited financial backing A possible answer:

• Other house buyers buy your property so that you can release equity and clear debt.

• You can then buy or rent an affordable home under standard terms.

• Basically you know where you stand and you have closure.

Article Source: http://www.realestatepropertyarticles.com.

About the Author:
Quick Move Now are one of the leading house buying companies in the UK.We buy houses and will buy your Bryant Homes and your Barratt Homes. They will buy your house for 90% of its value and can turn around in 7 days.