Seller offering to hold a note on 3 duplexes

[ST King]

I have a potential deal in which a seller is selling three duplexes and is offering to "hold a note" for 20% down of the agreed upon purchase price, on a 5 year balloon at 10% interest.

First, I think "hold a note" means that this is a seller financed deal, right?  Or maybe they're just agreeing to finance the 20% down?  Can someone clarify what this means.

I've looked up that a 5 year balloon means the entirety of the loan will be due after that 5 year period is up.  So the mortgage looks like a normal loan for 5 years then "balloons" to the remainder balance becoming due once that period is over.  Is that right?

Assuming the properties are in good condition, in a desirable location, and cashflow well, how good a deal is this to start out my portfolio?

Any help is greatly appreciated.  Feel free to dumb it down for me, too.  I'm new here.

Thanks!

[Malcomb Stapel]

@ST King  you need to clarify with them if they are financing the deal and you pay them 20% down, or if you are financing the deal but they are willing to loan you the 20% down payment that the bank is requiring. It would be two very different things. 

Also, in the case that it is the first option, you might as well run the numbers with a local bank and see what it looks like on a 30 year mortgage vs the 5 year balloon. You paying 20% to a seller to finance a property negates one of the biggest potential benefits of seller financing.