i shelled out big 20-25% down payments on my first few deals, and then realized... hey, this won't work for very long! 

Together, we have over $200K (mostly in stock market investments), and our parents may help with the down payment.

We would all love to have that note that has 5 years of perfect payments, 800+ credit score and a 20-25% down payment. 

I’ve done some research and have found that some banks will allow the seller finance portion from the seller to go towards the down payment of the loan, is that true?

Should it simply be left in a trust and payments made to the trust? 

The payment is roughly $260 a month.

In this case, since they are borrowing their payments, these would get added to the principal balance each month, and interest would be calculated on that.If, for example, the interest rate on the note were 10%, they would implicitly be borrowing their payments at that rate.

Downsides is you have less of your feet on the ground and really need to trust and verify all vendors.

I have a large lump sum saved in an investment account for down-payment and any additional costs.

The trust one can build up over the years on platforms like BP, Youtube and others is insane.