The ordinance itself says it is intended to "protect residential integrity."

Liquidity is equity, equity gives you protection from any lien holder whether seller, bank, HML, or PML.

However there are some states that protect tenants a lot... 

A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings.

The longer that you are in business the more familiar you get with how to protect yourself.3.

I'm in Alberta, so ASC has rules around what's allowed and what isn't (mainly aimed at protecting the public/investors).

This would protect you from being stuck with a higher rate when the balloon payment is due.After 5 years of interest-only payments, you'd still owe the full principal.

If you were able to use the standard TREC lease agreement, there are many items that protect the property/landlord in there. 

Also from researching I was told if there are mortgages on a property at a tax sale the bank would step in to protect their investment and pay the taxes to get the property.

Sellers need to be mindful of the time value of money, using realistic interest rates and structuring the deal to protect their position, whether through securing a first-position lien or obtaining a personal guarantee from the buyer.In the end, seller financing can be a win-win, but it requires a balance.