Only four firms are currently authorised by the FSA to conduct sale and rent back (SRB) activities, BestAdvice.net can reveal.
The FSA’s full regime for regulating SRB activities began on 30 June 2010 following a year of interim regulation.
The four firms are DFB Housing Solutions, Ingard Financial, Momentum Homes and Residential Property Solutions.
There were over 50 firms who had interim authorisation before the 30 June deadline.
SRB firms are banned from using exploitative advertising and high-pressure sales techniques, as well as emotive terms like ‘fast sale’, ‘mortgage rescue’ and ‘cash quickly’ in promotional literature.
Firms must offer a 14-day cooling-off period to give consumers more time to make decisions on sale and rent back. They are also prohibited from using cold calling and dropping promotional leaflets through letter boxes.
Security of tenure for customers for a minimum of five years must be offered and SRB must ensure measures are in place so all risks are clearly signposted to the customer, via FSA literature and during the sales process.
BestAdvice.net understands that the FSA anticipates authorising a number of firms for SRB this week although exact figures are unknown.
