The seller called it 12 usable acres and the county agreed, but the creek took three of them off the table

The structure here is clean and the note economics hold up well at that basis. The assumption doing the most work in your total-collections figure is the buyer running all 84 months without a payoff, refinance, or default. Rural installment buyers in that recreational category do prepay, especially once the land appreciates enough that a local credit union will look at it. If he pays off at month 36 or 48, you collect less interest but you also recover capital faster, which resets your deployment capacity. Worth modeling both paths before assuming the $46,000 figure.

On the setback disclosure, the thing you got right is harder to see until it goes wrong. Rescission exposure on a rural parcel in a small Missouri county is not a courtroom risk, it is a title-company-lobby risk. Once that conversation happens your deal flow in that county stiffens considerably. The reputation math favors honesty even before you get to the ethics of it.

The down payment question you are asking is really a basis-recovery question framed as a pricing question. The $3,500 down against an $18,500 purchase means you recovered 19 cents on the dollar at closing. If the note defaults after month one you are holding a parcel you need to resell again and you have collected $3,500 plus one payment. Some operators in this niche price the down payment to cover at minimum their acquisition cost plus recording and closing, which on your deal would have pointed toward something closer to $5,000 to $6,000. Others accept a lower down to widen the buyer pool, which is exactly what you did, and the 19-month payment history suggests the buyer was creditworthy enough to absorb that.

The risk you did not mention: what your Missouri installment contract says about reinstatement rights if he does go late. State-specific land contract law governs how long a buyer has to cure and whether you are looking at a forfeiture or a formal foreclosure to get the parcel back.

What is your current trigger for initiating default proceedings, a specific number of missed payments, or a dollar threshold?

The part worth adding is what happens to that note if the buyer ever decides to build something small, a shed, a hunting cabin, a well. The setback that did not bother him at purchase becomes a material constraint the moment he applies for a permit, and in some Missouri counties that kind of discovery triggers a buyer complaint even years after closing, framed as a disclosure failure. A deed restriction or a simple addendum at closing that spells out the setback boundary and the buyer's acknowledgment of it converts a verbal understanding into a document, which is the difference between a clean exit and a phone call in year three. The due-on-sale clause protects the note holder if the property transfers, but it does not protect against a buyer who feels surprised later and has a cousin who went to law school. On the note economics, 9.9 percent over 84 months on a $35,400 financed balance is aggressive in a good way, though the real sensitivity is whether that buyer's interest in hunting access holds if the property taxes climb or the deer pressure changes, because recreational land buyers are more mood-driven at payoff time than the payment history suggests. Did the closing documents include a written setback disclosure signed by the buyer, or did that stay in the conversation?

The risk nobody has named is what happens to that note if the buyer ever decides to build something and hits the setback for the first time through his own survey. He bought it for hunting and does not care now, but circumstances change, and if he later claims he was not adequately disclosed on the usable footprint he has a colorable argument depending on how the seller-financing docs were written. Missouri does not require the same disclosure depth a licensed broker would, but a note secured by a deed of trust on a parcel with a documented regulatory limitation should have that limitation spelled out in the collateral description or an attached addendum, because a future default and foreclosure gets complicated if the borrower raises a disclosure defense at that stage.

Did the closing docs or the note itself reference the setback and the 12-acre usable figure explicitly, or did the honest pricing just live in the listing and the conversation?