@Son D. the borrower paid off the loan a few months ago. 

Often, these investors buy bundles (tapes) of defaulted loans at a great discount to the principal balance and then create workout agreements with the borrowers to get the notes to perform.

Who ever borrowed you $1.2m will have sent you a 1098 by Jan 31st.

I figure we have around 5M equity we can borrow against after 70% ltv and buying out the other member.

I own a mortgage company, so I have my loan officers use this Fannie Mae income calculation tool for all business for self borrowers: https://singlefamily.fanniemae.com/applications-technology/income-calculator .

As someone who lends and also borrows private money, I know how important trust and transparency are in these deals.

Both Conventional loans and DSCR loans can offer this flexibility, depending on the specific scenario and borrower qualifications.

Shame on those here recommending it.Similarly, don’t even consider borrowing against your personal residence—even if you could qualify.

I do not borrow money for the EMD.

So % vs % on borrowed funds for investing, trading on margin is much more expensive, WAY higher risk, AND now even MORE loss of control because when these things out of your control happen you have no control for the status of those "assets".