Advice on Private Lending and how to plan for the worst

[Anthony Patel]

Hi guys

So I am hoping to see if I can get some advice or differing opinions on my current situation. As a person that travels for work a lot, my time in my city is limited to a few days each week, which means I need to stay very organised if I ever want to successfully build a team and flip houses on the side. 

I have a friend who is going to be purchasing a fix and flip from a wholesaler and use hard money to finance the loan, and am looking to provide funds for the construction costs, instead of her taking out a second construction loan, in order for to make a small return on my capital, but more so to be able to be apart of the flip project and learn as much as I can along the way.  

I have heard that getting a lien on the property is one way to have the money secured, but then this is dependent on the hard money lender which may or may not allow a second lien on the property? 

Also I want to be able to go onto the property and see work done and be apart of the project, but does this mean that I could be liable for any issues that go down on the work site because I was physically there? Do any of you private money lenders lend through an LLC? The other thing with creating an LLC is that as this is my personal savings, I want to be able to take out my money if I later on want to buy a house or do my own flip, and not necessarily have my money tied in an LLC as such.

I know there are a number of ways to structure this, but basically the two things I want to know is what are the best ways to mitigate risk whilst lending out for the first time and what levels of protection can you have if you plan on providing PM but still want to be able to be on site of the project and learn along the way. 

Thanks in advance!