If so, is there any red flags such as rental restrictions, limitations, etc.

Here is what the IRS says on the subject: Election for Husband and Wife Unincorporated Businesses A business owned and operated by the spouses through a limited liability company does not qualify for the election Only businesses that are owned and operated by spouses as co-owners (and not in the name of a state law entity) qualify for the election.

Is the number of licenses limited or restricted?

Lending capacity should only matter to those with large borrowing needs and require large legal lending limits but that wouldn't apply to hard money lenders anyway.

Mortgage Interest Deductions: Are there any limitations on how much mortgage interest I can deduct for my rental properties?

I would also set boundaries with the tenants, you might want to not out right say you are the owner either. 

So, I will set it up that way; he suggested this, because if there are disputes between me and the tenant, then they are more easily resolvable if the entity is in TN.Great news, if there is anything I can help with here in Memphis please reach out anytime. 

I limited each season to 20 people. 

Of course this all depends on YOU setting the base rate and all the knobs and triggers most appropriately.

This last bank limitation isn't a bad thing in my opinion because the long-term rental yields are low and what are you going to do if a tenant doesn't pay?