First and foremost, if I borrow from a "hard money lender" who has funds originated from a "Drug Cartel" or an "Organization Sponsored by ISIS" or any other shady resource, how would I know?

At the risk of sounding like a boring, vague, and painfully generic article, you will need to consider your credit history, income, assets, and liabilities among other things (as well as those of every co-borrower or co-signer).

That equity allows you to borrow MORE, to buy MORE (cash-neutral ones), with MORE equity!...

@Mindy Jensen Here is a straw man answer to the the generic LLC question.  1) If you don't have either a lot of assets in banks, brokerages, or real estate OR a big W-2 income that could be garnished, stop here and don't bother with entities.  2) If you are in California, the minimum franchise tax of $800 per LLC per year makes LLCs an expensive approach to asset protection.  3) If you are buying single family homes and want to get mortgages it is way less expensive to buy and borrow in your own name.  4) If you are still reading this because you are wealthy, live outside of California, and use commercial lenders, then you definitely have a lawyer you can talk to, so why are you asking this on the forum?

Which WON'T happen if you haven't bought "cleverly" enough.Yes, you'll end up borrowing more than you did at the start.

If that means you take out 65% debt on the property, so be it, but you need to borrow money to make money at any kind of speed.So, you leverage your SFRs to pull out enough cash to go for the 3rd or 4th. 

I want to be able to log in to the borrower's ledger online and view the income & expenses through the deal cycle.

A borrower who gets too creative, away from the norm and benefits (or could benefit) from the terms can enter predatory waters, even deeper offshore can be fraudulent.

But we prefer to control the paper; the underlying note (the loan and the borrowers promise to pay) and the mortgage (that offers the house or other asset as collateral as additional security making the note a secured note).  

For are next project , we borrowed money from a family member of mine and he is not asking for any interest return on that.