Do you want to be passive (ie give your $ to someone and they pay you interest, or you put the money for the opp and get equity, etc)3.

I suggest you enter private money goldmine in search botton at top right of the screen and read the previous posts....here is one that gives good perspective as well as a link to legitimate private lenders.http://www.biggerpockets.com/forums/92/topics/1488...

This would also prevent me from using the HELOC for a different type of investment like BRRRR or fix and flip.

Cost of Borrowing: Compare the interest rates and fees associated with a HELOC or cash-out refinance to the hard money loans you’ve been using.

one thing is your lending your money way under what private money should charge. unless your just doing your friends a favor..

@Pat Aboukhaled I would ULS (unit lot segment) the primary house and include a clause in the call option that would prevent them acquiring the DADU.

In neighborhood it is very important to present your self to the home owner next to you, this helps a lot to prevent misunderstandings. also this shows your professionalism.

How do you become a broker for hard money lending? 

Is that process too complicated, yes, but there is nothing in this decision that will prevent a tax sale purchaser in MD from reselling at a profit after obtaining the property by foreclosing the right of redemption.

--------------------------------------I don't think it prevents you as an owner from initiating the action.Personally, I wouldn't have any moratoriums on private transactions.