The tax code is built to favor business, one simply needs a good accounting firm whom knows how to exercise this.

To the best of my knowledge, notes on mortgages are valid until satisfied.Regarding your last sentence, the instrument that secures the repayment obligation with an interest in real property has a definite period within which it must be exercised in relation to the maturity date of the mortgage/DoT.

In September of last year I got the property back by exercising a quit-claim deed as the buyers stopped making payments.

Learned that lesson though, we'll exercise way more control this time, and limit customization.

Now run the same exercise for the principal paydown and factor in some cash flow / tax benefits on the side.You cannot get returns anywhere near this in the stock market or any other alternative with such certainty and low volatility.

I have found that if you do a good job up front ,  the seller is more likely to finance your purchase when you exercise your opinion . 

It was a trial and error exercise for us.  

@Leah Gober and anyone else: I was thinking a "tabletop" exercise would be interesting.

If we found a buyer before we actually purchased it who would pay us what we wanted we were going to sell it wholesale.Once the purchase went through we advertised it as a rehabber flip and started the demo.During different stages we added our desired profit and advertised it as a fixer upper.During that time we found a buyer through FB who wanted to purchase it once we completed it.We contracted it to them on a Lease option Purchase which means at some future date they can exercise there option to purchase but until then they are strictly renting it.So all that being said, we bought it at $10,000 put in about $20 in rehab (personal loans for some of this) and sold/optioned it at $67,500.  

If you remove the borrower from title, yes the bank can exercise the due on sale if they choose to.