What are the pros and cons of holding a short term first private mortgage

First its not a good idea to piggyback your question on someone else's thread. This tends to cause confusion. So your question has been moved to its own thread.

It depends on the circumstances. You will have to keep track of the payments and report the interest to the IRS. Plus you also take the risk of default. On the plus side it may be the only way to sell the house.