I’ve found that it’s best to wait until stain-grade work has received its coat of stain and one coat of finish before filling the nail holes. If you fill the holes prior to applying the stain, you will likely fill the pores of the wood adjacent to the nail hole. This will cause blotchy patches around the nail holes (even after sanding), as the stain penetrates differentially.
I prefer to fill the nail holes with Minwax waxfill pencils. I heat the tip of the wax pencil with a torch just prior to filling the hole. I work the wax into the holes with a warmed, flexible painter’s palette knife.
Wayne M. Sammons, Reheboth Beach, DE