That's my biggest concern.But I should also look at the tax and long term benefits.

@Asim G. if owners weren't so short-sightedly cheap, PMC's wouldn't be doing this!

Are there specific qualities or terms you look for that make the relationship a good fit for your investment strategy?

I'm looking to finance the project long term in a way that is helps me create positive cashflow.

Whether you're eyeing long-term rental properties, MTR Market, or are looking to live here yourself- this area is full of potential.

Google the term UBIT.Tom Wheelwright has a chapter on why you don't want to do this in his book Tax Free Wealth.

I’ll try to keep this as short as possible but I am at a cross road in life here and can’t seem to find the guidance I need. 

And if your investor friend’s private loan helps fill in any gaps, it might be worth considering that short-term pain for long-term stability.What do you think you’d focus on first... paying off that line of credit as fast as possible or jumpstarting the renovation to boost cash flow right away? 

Quote from @Martin Jones: Hello, I'm young individual who is interested in long term buy and hold multifamily real estate.

I think the long-term plan for this home is either to sell it later on or keep it as a rental as this isn't our forever home.