Are there Rules against this? hi

[Harrison Engle]

Hey, everyone. I'm really interested in Real Estate Investing/Finance and I like creative investing but I don't have any practical experience. I'm only 25 and property is really expensive here in the Bay area. I might have the opportunity to go partners with someone to buy a property with seller financing where the owner carries the note in full. 

From what I've read the interest rates are generally higher when doing this(aprox 7%?). This got me thinking but correct me if I'm wrong, if interest paid for investment properties is tax deductible then what stops the parties for agreeing to a lower sale price and higher interest rate wherein the seller might gain more cash from the sale over-all and the buyer reaps more of a tax deduction? 

I haven't done the math on this theory, but If this in fact possible to make higher deductions, are there rules against this or reasons why one party of the other wouldn't want to do this? 

p.s. didn't finish the title before posting and can't edit but do take it as a "Hi" I guess haha.