For our private lenders, we use people in our local real estate community.

I'm familiar with how a hard money loan is structured, but structuring a deal from a private lender seems like the wild west.

Sometimes it’s surrendering the ability to get your money back at all… see this thread on Norada Capitalhttps://www.biggerpockets.com/forums/960/topics/1196567-nora...Unrelated to any investment I have made or even real estate, I have watched both my parents fall victim to clever marketing scams where they lost a combined 6 figure sums - both from in person marketed investments… so not something like a phone scam… but was a private placement “opportunity” not unlike how a syndications are offered, where management siphoned off investor money and used it for their own purposes.   

Should I consider private lending, HELOC or another short term lending to fund the home construction? 

The number of private landlords sued for more than their insurance will cover is astronomically low.The best protection: follow the law, and treat your tenants honestly.

If you need more information pls send me a private message or just reply my post thanks

Speaking to an asset protection attorney about this where you can discuss your personal assets and business assets in a private conversation might be something you would want to look into.

I have been looking at local private lenders, too. 

My first deal came from the thousands of postcards that I mailed out to private note sellers in TX.

@Tom Dean - alright private message sent!