Private Lending - secured loan with insufficient security

[Patrick McGarry]

I am wanting to loan $100K to an LLC that buys, remodels, and sells houses. The borrower needs to secure the loan so that it can deduct the interest paid to me on its taxes, right?

If yes, can the borrower secure the loan with a property that is worth less than $100K -- if I am OK with it?

Thank you for your assistance.