Owner financed sale of rental property

[Ruth Ann Morris]

I am considering selling a property I own using seller financing. My thought was to require 10% to 20% down, charge between 6% and 7% interest, set the payments as if it was a thirty year loan but require a balloon payment of the remaining balance at the end of 10 years. I would appreciate thoughts on how I should structure it, ideas on what to watch out for and how I should word the contract to protect me should the buyer miss a payment, etc. If anyone has good or bad experiences with this type of sale, what was good about it, or what went wrong? The reason for the 10 year balloon is I figured that would be about the time I would be starting to sell off rental properties anyway.

For added information, the current tenants approached me to buy the place. It has a current market value of around $220k and I owe about $90k. Monthly rental income is $1450 and the current mortgage payment is $600 a month.