UK Govt Urged to Help Struggling Homeowners

Strathaven based MSP Linda Fabiani and the Scottish Government have appealed to Westminster to protect struggling homeowners.

Minister for Europe Ms Fabiani urged that help be given to homeowners in “sale and rentback” schemes operated by private landlords, which involve homeowners giving up a large part of the equity in the property in return for staying on as a tenant.

Ms Fabiani said:

“The Office of Fair Trading has recommended that sale and rent back schemes be subject to legal regulation by the Financial Services Authority as many people are unaware of the full costs and risks.

“I am concerned that homeowners may be exploited by unscrupulous operators taking advantage of weak legislation. Given the state of the housing market its is imperative that the UK Government takes action to regulate the sale and rent back market and provide real protection to homeowners.

“I know that some homeowners in East Kilbride are already encountering difficulties due to the impact of the credit crunch and people are making enquiries into the sale and rent back scheme. However, the criteria for qualifying for these schemes means many who would like to use it can not and some landlords are reluctant to participate in the practice.

“We must at this difficult time do all that we can to support those who find themselves at risk of losing their homes due to circumstances they themselves are not responsible for creating.

“The Scottish Government supports the recommendations in the OFT report and the UK Government must act to help vulnerable Scottish homeowners.”