Rent to Buy between private individuals

Is it possible for a rent to buy scheme to be completed by private individuals. For example someone buys a house, agrees to sell to another person who will live in it and pay off the purchase price on a monthly basis over a number of years.

All the information I've found on it refers to builders and developers.

What is a rent to buy scheme? Essentially the owner agrees to rent the property to a tenant and then enters into an option with the tenant to sell them the property at an agreed price and time. Can 't see why you can't do that.

You seem to be suggesting that I sell a house to you for deferred consideration over a long number of years. No legal reason why you could not do that.

Not sure how it would be treated for tax purposes.

You can do it, but it would be a legal minefield and either side is taking a big risk .

If we assume that the tenant pays rent for 30 years and does not get ownership until then. No-one in their right mind would go for this, unless their legal rights were water-tight.

On the other hand, if ownership passes at the beginning of the deal, the seller is handing over a valuable asset with few guarantees of getting their money.
If they charge interest then they are acting as an illegal money-lender

Either way, what happens if during the lifetime of the deal one of the people dies / gets married ( family home protection act issues) / gets divorced and their assets are being divided up by the courts / goes bankrupt and their assets are being divided up by the courts / skips the country / refuses to pay.

No idea what the tax implications are. Rent is taxed income.

no, cant see it being a good deal for anyone,

sahd said:

Most rent to buy schemes are short term and are put in place where buyers don't have a deposit. They usually involve the buyer agreeing to pay a price for the house on or before a certain date - but in the meantime they pay rent for it and live in it as a tenant . The rent is kept by the seller and is used towards the the deposit when/if the buyer buys the house. If the buyer pulls out - the seller keeps the rent.
There would need to be some protection for the buyer if the seller pulls out. The rent would probably need to be kept by a solicitor ??
It would probably cost a good bit to get a contract drawn up by a solicitor - but then again some of them must have done these contracts for developers.

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In a rent to buy scheme part of the periodic payment is treated as rent and part of it is a deposit - and AFAIK the tax treatment also follows this.

If a proper contractual arrangement is in place then there's no reason why a solicitor would need to hold any of the money - if the buyer doesn't exercise their option by the required time then the seller retains the "deposit", and on the other side the seller doesn't have any option to pull out - presumably the buyer's option is a burden (or whatever the correct legal term is) on the property.

Thanks for the replies. It seems to be as complicated as I thought (legally and tax wise). It was idea to help out a relative who would not get a mortgage due to age. Back to the drawing board I think.