What terms for a short term private loan?

[BRANDY MEADE]

Someone has asked me to provide a short term private loan of $10,000. He is currently selling his home and will be purchasing a new build in another neighborhood. He needs to put a $10,000 deposit on the new lot to reserve it. He is asking for a loan of $10K to use for that deposit and will pay off the loan at close of escrow of his current residence. 

He has asked me to name the terms. This is someone I have met through a local real estate investment group. 

What terms would be considered fair without trying to be greedy?

How would you structure the deal? Would I have to record a lien against his current property to be assured of being paid out of escrow?

I'm not sure if I would use personal funds, or funds from my self directed 401k. If using the 401k, are there any issues I need to be aware of?

By the way, I did some preliminary checking and believe he owes about $345K on his current home and it is listed at $449K. He received an offer today (don't know amount yet). I believe the term of the loan would end up being 1-3 months.

Thank you for your input and time.

Brandy