it catches on fire and he doesn't have insurance etc). Do you really want to be married to the success of the property (and borrower) for the next many years? If so, then go for it.
I'd require a personal guarantee from the buyer. And 25% down and 6.5% seem friendly to a buyer... but if you can get a better sales prices because of those terms then it's all just part of the negotiation.
Note that if you do it you need to act like a normal lender... require certificates of insurance, do inspections of the building etc.
And you need to ask yourself - why am I selling when in the end, the deal is a lot like a monthly lease anyway.