I want my rent now, in money I understand and can spend. 

You are going to have a lot of trouble finding financing options with a 2nd lien and to 100% make up a purchase price (i.e. 100% debt financed with no equity or down payment "skin in the game") as part of your payment.I'd recommend looking in the "Creative Financing" subforum if you want to explore potential ways of doing this but frankly it is really difficult to find a genuine "shortcut" that wont end badly for not investing any of your money at all.BRRRR Method remains IMO the best for this but you still have to put some of your own capital to use during the process

If yes and yes money back or discount or sue and confirm they face penalties for failure to disclose and that they “remember” to disclose to next buyer. 

Back in Washington where we fix & flipped properties I did anything from general contracting from demo to finishing touches, managed project budgets & timelines to stay within our projections and SOW, raised capital for down payment on hard money loans, interest on loans and rehabs, worked with my hands (best at flooring, trim, caulk, cabinets, fences, punch list items) and was the real estate agent for acquiring and selling our flips.

We have let him stay for free for the last 8 year's basically supporting him, with a verbal agreement he would fix up the place.

We used hard money financing and put approx $200,000 into the property in rehab.

I can always turn this into a LTR but with the current rates I would be losing money every month.

That is if money is not an obstacle...

I was thinking I would need to get a hard money loan to cover that, and it would eat up most of the rest of the cashflow and then I would look to refinance within a year or two.

He will finance building the house. this can be done however you want -  my recommendation where I see things go wrong is everyone is high and drinking the kool aid when they go into these deals thinking they are going to be making all this money.