Plain-English guide. Not legal advice. A lawyer should review anything you sign.
Risks in plain English
Balloons, missed payments, and due-on-sale are the three that surprise people.
A balloon is a big payment at the end. If the contract says the balance is due in year five, you need a plan for that money. Do not assume a bank will lend it to you later.
If the buyer misses payments, the seller may be able to take the property back, but only the way the contract and state law allow. That can mean foreclosure or forfeiture. It is slow, public, and expensive. Know which one your paperwork uses.
If the seller still has a mortgage, selling the house can let that lender demand the whole loan immediately. That is the due-on-sale clause. Subject-to deals and wraparounds are the structures where this risk is sharpest. An assumption that the lender approves in writing is different.
Have a lawyer in the property's state read the papers before money moves. Nothing here is legal advice.