This isn’t a seller-financed loan. Seller-financing means the person selling the home gives the buyer a loan. Since you didn’t own the home and just provided the funds, this is considered a Private Family Loan.
If you charge interest, you can give your relative a written statement or a simple spreadsheet with your name, address, and Social Security Number and the amount of mortgage interest paid. They’ll need this to claim an itemized deduction for the interest payment on their tax return.
For the interest to be deductible, the loan must be secured by the home, and the mortgage agreement should be recorded with the local or state government. This protects your rights if the loan isn’t repaid.
Report your interest income on Schedule B of your tax return, even if you don't get a 1099-INT. Please read the following post by VanessaA that supports my answer.
Mortgage Interest on Loan to Family Member
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