Sometimes people need to sell their homes fast. This can be for several reasons, such as divorce, a new job or in extreme cases to secure funds to pay…
Sometimes people need to sell their homes fast. This can be for several reasons, such as divorce, a new job or in extreme cases to secure funds to pay off debt.
However, consumers who want to sell their homes through a so-called quick sale company are in danger of being misled, according to the Office of Fair Trading (OFT).
These providers offer to purchase houses in as little as seven days, but at a smaller portion of the full market value. The company then resells the property for more money to make a profit.
The OFT is warning that homeowners may be being ripped off by some of these companies, as they receive only a fraction of the value of the house in return.
In some cases companies have agreed to buy a house, but then have reduced the price at the very last minute, taking advantage of the consumer's need to sell quickly, according to the OFT.
Cavendish Elithorn of the OFT said: "Businesses offering quick house sales may provide a useful service for homeowners who need to unlock cash in a hurry. However, they are often used by consumers in vulnerable situations and therefore we are concerned about the risk of consumers being misled and losing out on large sums of money."
The OFT identified those particularly at risk include people selling after a relationship breakdown, or the elderly who might need to find money to pay for long-term care.
Practices that are causing the most concern include unclear fee structures, companies wrongly claiming to be a cash buyer and reducing the price just before the deal is signed. The OFT has warned people about businesses making false property valuations to customers and tying them into contracts preventing them from selling to others, should alternative offers emerge.
When in debt, it is important for people to retain as much of the full value of their property as possible, as losing out could be catastrophic for their finances.