The other major risk I see compared to buying and holding whole notes in the investors sole name is with the fund investor expect return day one of the money going into the fund.. this business is fluid it might take some time to close a loan so now the fund has drag on the raised capital and if it gets bad enough it becomes a major problem.

Once you get some of the always slightly caustic drain trap fluid on your fingers, your fingers soften up and the skin abrades easily on them.