selling

Sale and rent back schemes: how they work, the risks and the alternatives to check first

Sale and rent back schemes explained for England: how they work, FCA regulation, the risks to your home and benefits, and options to check before signing.

4 min read
Last reviewed 4 November 2026
By Your Property Check team

Part 1 of 7

Speak to free advice first

General information, not advice. If you are thinking about sale and rent back because of money worries or mortgage arrears, talk to free, independent advice before any company. Citizens Advice says not to ignore your lender, explain your situation, and that mortgage arrears are a priority debt. If your lender has given you written notice of repossession, it says you can get free legal help from the Housing Loss Prevention Advice Service. Details are in the Citizens Advice guide to dealing with mortgage debts, which applies to England. We read the pages named below on 4 November 2026.

Part 2 of 7

How a sale and rent back works

Citizens Advice describes it as selling your home to a private company and renting it back from them. It says the schemes are also called buy back or sale and lease back, and that firms usually buy homes below market rate, so you could lose money. The Advertising Standards Authority says firms buy homes usually at below market value, and the seller keeps the right to live there for a minimum of five years. It notes that these deals are often marketed to people in financial difficulty who may be facing repossession.

Part 3 of 7

The two descriptions of the tenancy

The sources differ in detail, so check your own agreement. Citizens Advice says you usually rent back on an assured tenancy with no fixed term or end date, and that you can still be evicted if you breach the terms, such as missing rent, or if your new landlord gets into financial difficulty and a creditor repossesses the home. The ASA says the seller gets a right to remain for a minimum of five years. Neither page says anything about rent levels or when and how rent can change, so we cannot say what will happen to your rent over time. Ask for the rent and any review terms in writing, and have a solicitor read them.

Part 4 of 7

Is it regulated?

Yes. Citizens Advice says the FCA regulates these schemes, checks whether firms follow the rules and meet certain standards, and requires firms to be authorised. It says to check this on the FCA firm checker before you use one. The ASA says the FCA has regulated firms offering these deals to consumers since June 2010. Citizens Advice says the FCA has previously found many serious problems with a number of these firms, and that you can complain to the Financial Ombudsman Service if a firm has not followed the rules.

Citizens Advice lists rules firms must follow: they cannot post promotional leaflets through your letterbox, they must check that you can afford the agreement and how it might affect your benefit entitlement, and they must arrange an independent valuation of your home if you do not already have one. You also get a 14-day cooling-off period after signing up.

Part 5 of 7

Risks to know about

Citizens Advice lists these risks:

You will usually sell for less than the home is worth.
As a renter, you could be evicted.
Your mortgage lender can refuse to let you sell if the offer is less than what you owe on your mortgage and any secured loans.
A Debt Relief Order application could be refused if you sold for less than true value in the last 2 years.
If you go bankrupt, the official receiver can reverse a sale made for less than true value in the last 5 years.
You usually cannot claim the housing element of Universal Credit or Housing Benefit until 5 years after the sale, with an exception for people who needed the scheme to stay in their home, for example if the lender was seeking possession.

Part 6 of 7

Comparing the options

Feature	Sale and rent back	Selling and renting elsewhere	Staying and refinancing
Do you keep the home?	You stay as a tenant	No	Yes
Price	Usually below market rate	Open market	Not applicable
Security	Assured tenancy; can be ended if terms are breached	Depends on your new landlord	You remain the owner while you meet the mortgage terms
Regulation	FCA regulated; check the firm	Estate agents must belong to a redress scheme	Lender must agree to any change
Main risk	Eviction, lower price, benefit limits	Moving costs and a new tenancy	Fees; secured borrowing risks the home

Citizens Advice names two alternatives: get help with your mortgage debts so you may be able to keep the property, and sell on the open market and rent elsewhere, which it says usually makes you more money. For the first, it lists options such as adding the arrears to your mortgage, extending the term, switching to interest-only or agreeing a payment break. Your lender must agree and fees may apply. Our guides on selling with a mortgage and negative equity explain what a sale involves.

Part 7 of 7

Before you sign anything

Confirm the firm is authorised on the FCA register.
Read the terms to see how the deal could affect your long-term housing and finances.
Get an independent valuation and compare it with the offer.
Speak to an independent financial adviser and a solicitor. Citizens Advice points to Unbiased and Wayfinder to find an adviser, and to MoneyHelper for more on these schemes.
Use the 14-day cooling-off period if you need it.

This page is general information, not advice.

Our take

Compare every route before you sell below value

Our view: sale and rent back deserves caution. Citizens Advice says firms usually buy below market rate and presents the schemes as risky, so get free debt advice first, check the firm on the FCA register and compare what an open market sale would leave you with. The common mistake is deciding under pressure with one offer on the table.

What Your Property Check adds: our sale method comparison sets auction, estate agent and cash buyer side by side on net proceeds and timescale, and our free house valuation gives a sourced range from real Land Registry sold prices to compare any offer against.

Compare sale routes

Our opinion, drawn from the facts on this page: not advice and not a forecast. We earn from OfferCheck reports and from introducing sellers to cash buyers, so weigh it with that in mind (see our disclosure). We are not authorised or regulated by the FCA.

Questions, answered

Frequently asked questions

What is sale and rent back?

Selling your home to a private company and renting it back. Citizens Advice says firms usually buy below market rate. The ASA says the seller keeps the right to live there for a minimum of five years.

Is sale and rent back regulated?

Yes. Citizens Advice says the Financial Conduct Authority regulates these schemes and firms must be authorised, so check the FCA firm checker first. The ASA says the FCA has regulated firms since June 2010.

What happens to your rent over time?

The pages we read do not say how rent is set or reviewed, so we make no claim. Ask for the rent and review terms in writing and have a solicitor read them before you sign.

Who should you speak to first?

Free independent advice. Citizens Advice says not to ignore your lender, to treat mortgage arrears as a priority debt and to speak to a debt adviser immediately if you cannot agree terms. It also points to MoneyHelper and an independent financial adviser.

Can I change my mind after signing?

Citizens Advice says you get a 14-day cooling-off period after signing up. Check your agreement for how to use it.

Where this comes from

Sources

Last reviewed 4 November 2026 by the Your Property Check team. This page is general information, not legal, tax or financial advice. For your own situation, speak to a conveyancing solicitor or another qualified professional.