And you'd benefit yourself by going to play golf, fishing or take a quick vacation trip - to make sure personalities mesh and build friendships among the members.

Friendship is built on trust and shared experiences. 

Just wanted to be upfront so that our friendship and business relationship both last a long time...”“.... hey you remember that time I made out with your sister?

Note that I am willing to take the risk of losing friendship and losing the money.Also what interest rate should I charge?

I also like to ask them what it would do to their friendship if that person didn't perform on the deal.

This, however, is only if you are comfortable utilizing it for leverage.If done right, I think your worst case scenario is a shattered friendship at the cost of a property you got at an 85% discount, a deal people often only dream of. 

I am wondering if I should treat them as I would any other tenant such as asking for Security Deposits, Signing a formal lease agreement w/ terms, verifying their incomes (to make sure I can get paid and friendship doesn't go sour) and holding up the lease agreement?

Hello all,looking forward to networking, learning from others, building alliances and friendships and perhaps even partnerships.

It caused a lot of headaches and lost friendships…but it helped keep my expenses down so I could put all of my then meager salary into updating the property.

Build some friendships.