The Office of Fair Trading (OFT) has challenged several sale and rent back companies over advertising claims.
A total of 16 companies have been contacted by the OFT, which is requesting proof that they live up the claims made in their advertisements.
The OFT says the firms made a number of claims in their advertising, which it believes may be misleading for potential customers.
These include; telling customers they can stay in their property for as long as like after it being sold, that they can buy back their property at am agreed point in the future, and that customers will benefit from low rent and flexible terms.
The OFT says the firms must substantiate their claims, and has given them 14 days to comply. Any information received will be evaluated before the OFT considers further action.
'Sale and rentback companies must be clear and transparent about the services they offer and the security consumers have as tenants," says the OFT's senior director of consumer protection, Heather Clayton.
"Clarity of advertisements is particularly important in the sale and rent back sector where customers may be under stress from financial difficulties, at risk of losing their homes and making important and complicated decisions."
Sale and rent back firms were subject to an OFT investigation last year, and statutory regulation has been recommended to protect consumers from the controversial schemes.
Contact: John Bakie, Tel: 020 7484 9805, e-mail: [email protected]IFAonline
Putting the tech into protection
Square Mile’s series of informal interviews
Fallout from Haywood suspension
Launching later in 2019
£80bn funds under calculation