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08/09/2009
OFT Investigates Retirement Home Exit Fees
The Office of Fair Trading (OFT) is issuing formal written notices to 26 retirement home firms setting out concerns over fees charged when residents sell or rent their properties.
The OFT is concerned in particular about the fairness and clarity of contract terms providing for these so-called 'exit fees', charged to occupants of purpose built retirement homes which may breach the Unfair Terms in Consumer Contracts Regulations.
The firms are being given 14 days to respond. The OFT is also seeking information and views about the terms from residents, consumer groups and other interested parties. Once all parties have provided their input the OFT will decide how to proceed.
The investigation follows voluntary undertakings secured from a major builder of UK retirement apartments, McCarthy and Stone, to remove an exit fee charging consumers one per cent of the sale price when a property is sold.
Heather Clayton, OFT Senior Director of Consumer Protection, said: "This investigation is motivated by the need to ensure that terms and conditions are clear and fair, particularly in this sector where customers are potentially vulnerable. We know there are concerns and will consider all responses and evidence from interested parties on these issues."
(CD/GK)
The OFT is concerned in particular about the fairness and clarity of contract terms providing for these so-called 'exit fees', charged to occupants of purpose built retirement homes which may breach the Unfair Terms in Consumer Contracts Regulations.
The firms are being given 14 days to respond. The OFT is also seeking information and views about the terms from residents, consumer groups and other interested parties. Once all parties have provided their input the OFT will decide how to proceed.
The investigation follows voluntary undertakings secured from a major builder of UK retirement apartments, McCarthy and Stone, to remove an exit fee charging consumers one per cent of the sale price when a property is sold.
Heather Clayton, OFT Senior Director of Consumer Protection, said: "This investigation is motivated by the need to ensure that terms and conditions are clear and fair, particularly in this sector where customers are potentially vulnerable. We know there are concerns and will consider all responses and evidence from interested parties on these issues."
(CD/GK)
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