Is sell and rent back the answer?
Do you need to sell your home, but don’t want to move?
A relatively new player in the home repossession market is ‘sell and rent back’. This product lets people at risk of repossession sell their property then rent it back from the new corporate owner, meaning they don’t have to move out. The kids can stay at their current school, you keep your community and remain close to your friends. So sell and rent back can be the answer for some householders.
No costs, chains or stress. It couldn’t be easier. Or could it?
Sell and rent back is being heavily marketed at the moment as a great solution to repossession problems. Even though you sell your home and give up all claim to ownership, you can stay there so family disruption is minimised. Selling to rent back isn’t for everyone but, depending on your individual circumstances, it can help ease your situation.
Avoiding all the usual fees and charges
Sell and rent back lets you release the equity held in your home. In doing so you avoid all the usual costs and fees, as the deal includes all the charges involved in buying your home and renting it back to you. So you save thousands of pounds on estate agents’ fees, HIP costs and survey charges. And even though you don’t have to pay legal fees on sell and rent back deals, you still have your own solicitor to represent you.
You get a long renewable lease
Many cash for houses providers grant a ten year renewable lease, or assured shorthold tenancy, the UK’s standard private lettings lease. Under your lease, you’ll be allowed to rent your home back for at least a decade if you wish to, sometimes longer if you negotiate.
Get 100% market value for your house
Selling to rent back can give you the full 100% market value… very rarely. Many arrangements give you at least 30% less than your home’s market value. Most providers pay out an initial lump sum, usually about 70% of the agreed sum, on completion of the sale. The remaining 30% is given back to you when you tenancy ends.
Sell and rent back to become a tenant in your old home
On completion the company will grant you a 10 year ‘assured shorthold tenancy’.
Find out more about Assured Shorthold Tenancy agreements at: Communities.gov.uk/housing