You mentioned you haven't purchased an investment property before or been involved with seller financing transactions.

If the seller files for bankruptcy, that will involve you in a legal proceeding.

For an SBA hotel loan, the SBA may guarantee say 30% of the loan and a traditional bank takes the next 50%...total LTV/LTC of 80%...will vary by business but it's higher/better than the previous replies (otherwise, you would just get a traditional commercial loan without the SBA involved). 

Quote from @Danielle B: I'm looking to get involved in Section 8 housing out-of-state - in OH.

Real estate is transactional where people are involved so it won't be a black and white answer.The best to do is to find an agent that fits your needs and guide you through the process.

How do you know who does and doesn't know what risks are involved when they make an investment?

All IRA-related transactions must be "arm's length", in other words, IRA can't get involved in any transaction with yourself, your immediate family members or any entities these individuals own or control. 

He then says he is going to get a lawyer involved if i dont feel like i owe him anything.

They both were up in the Glendale area for 15-20 years or more, and were very involved with the local business community.

As mentioned by @Chris Mason, Bridge Loans: These short-term loans can provide immediate financing until more traditional financing becomes available or until the property stabilizes and becomes more attractive to lenders.Interest rates and stipulations may be a pain.Out of the box here and requires a few more research, SBA Loans: Small Business Administration loans can be an option, especially the SBA 7(a) loan program, which can be used for hotel acquisitions.I heard someone  mention - Mezzanine Financing: it involves a combination of debt and equity financing, which might appeal to some investors looking for higher returns.