From the seller side:
Bond for Deeds (BFD's) suck if the buyer doesn't have some skin in the game. Make sure the individual is putting down a nice piece of change. Keep in mind that a bank didn't trust this person and they judge borrowers on daily basis. Protect yourself and your property. I would probably treat them more like renters than actual homeowners. Three clauses I would recommend putting in any BFD:
1st - 30, 60 or 90 day option to enter into the property with 24 hours notice.
2nd - mandatory refinance into permanent financing in the next 5, 10, 15 years. It all depends on your plan.
3rd - All payments will be held by an escrow service. This is really in the buyers favor because it helps build a payment history. It also takes you out of the collection phase of the BFD. this feature cost a few extra dollars.
BFD's can work but you have to plan ahead and use a great BFD attorney. I would definitely seek out a expert in this aspect of real estate law.
I hope this helps.
I agree with Lisa, that you should speak with a title attorney to learn more about the details.
On the other hand, with either scenario you get to own a property, get the tax deductions on interest and homestead exemption if you live there as your primary residence.
I have gone through both and once everyone is on the up and up, it works out pretty well...and elminates the miscellaneous fees and points Banks like to charge.