House offer with delayed payment option - what am I missing?

[AntiStars]

Have a house that's been rented out. Tennant's have now left so vacant and on market for 20 weeks at £170k. Place needs modernisation, new boiler, redecoration and new carpets throughout. Off putting to a 1st time buyer in current state but a landlord could turn it quickly and sell or rent ~1k per month. Have had 1 x offer of 150k which I declined as too low and now looking to swap agents BUT, was given the details of someone who buys houses that other people can't sell eg mould problems, cash needed quick etc.
They've offered to buy for 170k with 110k paid now (this will mean I can clear my mortgage and have a 40K lump sum) and they will then give me the other 60k (delayed) in 5 years time as a 2nd lump sum but will give me interim payments of the interest (4%) on the 60K during those 5 years.
I asked what happens if he dies or his company goes bust etc in those 5 years before I get my full money back and he said that my money is personally guaranteed but not underwritten by a bank so the contracts would be drawn up by a solicitor and be legally binding etc but has anyone heard of this or bought a house in this manner before? What am I missing? I presume there's some tax/capital gains implications as well as the obvious high risk that he could be a complete fraudster?

Speak to an auction house, set a reserve price you’re happy with and try that - people like fixer uppers in auctions

Why are you entertaining this OP, it’s too risky.

Joe Bloggs and Son buys your flat cheap. Sells it on. Then within a reasonable time period once hes bought lots of houses, goes bust accidentally on purpose. Hes made a fortune. And disposed of it carefully offshore where it can be touched.

a company called Joseph Bloggs and son then appears. It’s the same guys. They are still doing the same thing. The director is now the other guy. Guess what happens within a year.

Then Jo Bloggs and sons appears. The mum is now the director. Guess What happens.

Dont get into it. Don’t waste money on deferred lawyers. Each time you need them it’ll cost a fortune. A court case could cost tens of thousands.

Think about the old “if it looks too good to be true it probably is” Just hold out til spring when the market picks up, or tart up the property to appeal to more people, or sell cheap and cut your losses.

You’d probably be at the bottom of the creditors meaning all large underwritten debts would be before yours and you’d probably get nothing.

Ha ha ha. I told you that there would be "all sorts of reasons" why he wouldn't couldn't do it.

And what has it got to do with the lenders? 🤔

Get him to "look at it", OP. See how far that goes!

You're dangling on his hook, OP, and he'll promise anything at this point, until you've paid solicitors and don't feel you can back out without losing money.

BTW, who gave you his details?

The company will go bankrupt within 5 years or bloke will be living abroad. It’s too risky.

150k is a bird in the hand. A house is only worth what someone is prepared to pay.

By the time you'd gone to all that hassle and expense, you may as well have accepted the offer of £150K, with all the certainty that would give. If you've got to add all the extra safety nets, then ther is something badly wrong.

I can't understand why people invite complexity into their lives.

it’s easy for people that aren’t property investors to say ‘scam’

no it's easy for anyone with half a brain cell to say scam! Because that's what it is.

Funny how you then say approach with caution, I wonder why....

Why why WHY on Earth are you considering this?! Literally one person on this entire thread has told you it could work, and you have literally no idea who they are - they could be the bloke making this ‘offer’ for all you know. Your house is clearly not worth £170. No one is prepared to pay you that. A real investor won’t give you over the odds for your property. They are out to make money. So you’re blinded by greed and going to give it to someone for £110 (and an IOU) instead of the legit offer of £150 from someone else, because this bloke has said he’ll pay you in 5 years?! If he could pay you, he would do so now. He doesn’t have the other £60k. He won’t have it in 2030 either. Open your eyes!

What he means by this is that his property is already heavily mortgaged at high Ltv - so that lender has first charge. It means even if he agrees to a second charge you would only get anything that might be left over. In the event of bankruptcy the first charge lender takes possession of his property and is only interested in getting their money back. Your second charge position carries considerable risk of getting nothing. Definitely too risky.

It’s is a thing I’ve been involved in a property investment group BUT your solicitor fees will be significantly higher and you will probably need to pay capital gains tax on the full value rather than the £110k. Have you factored capital gains tax into your calculations?

I wouldn’t do it just because it will be complicated and expensive for you to transact.