Private Money Loan Structure?

[Johnny Bravo]

Hey everyone, I’m working to get my first deal going and will probably be going the private money route, at least for the down payment. This would be for a long-term hold focusing on cash flow as opposed to immediate equity gains. So I probably won't be doing a cash-out refinance. Because of this, I want to make sure I understand how deals like this are usually structured. Any and all feedback is welcome. 

And of course, I understand that every deal is different and it depends on the property and the numbers. I'm just looking for feedback on structuring the loan deal. 

Here’s what I’m thinking in terms of numbers as an example.

Private $ Loan Amount: $50,000

Rate: 10%

Deferred Payment: 3 months (I don’t have to pay out a disbursement for 3 months to allow for any reno and renting)

Year 1 Monthly Disbursement: $556 ($50,000 x 10% / 9 payments)

Year 2 Monthly Disbursement: $417 ($50,000 x 10% / 12 payments)

Balloon payment of original loan amount at any time.

So here are my specific questions:

• Do I simply pay them the interest indefinitely until I sell or otherwise have the capital to pay them back their original $50,000 loan (balloon payment)? Or should my monthly disbursements be priced out to pay off the loan in 1-2-3-x years?
• If it’s for a multiyear loan, is it 10% of the original loan ($50,000), or 10% of the year one amount ($55,000)?

Again, I’m a newbie so any feedback or guidance is appreciated.