28 Jul

Sale and rent back an "excellent" way to free up equity, expert says

Sale and rent back an "excellent" way to free up equity, expert says

Sale and rent back schemes can be an "excellent" option for troubled homeowners looking to free up equity, according to one property adviser.

The co-owner of the Homeowners Advice Centre has revealed that he is working with several tenants who are now in a better situation due to benefitting from the money they released when selling to the firm.

Nevertheless, Chris Jenkins advised those considering selling their property and renting it back to be aware that in doing so they will be giving away some of their equity.

"Consider other options such as a remortgage or equity release and make sure that you are certain that sale and rent back is for you," he advised.

In related news, research by insurance group Norwich Union discovered that the average value of a property used for equity release decreased by approximately £18,000 above the UK property average between 1999 and 2008, while 80,000 Norwich Union customers released £2.8 billion of equity from their homes in the last ten years.

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