I would expect him to respond based on what you said.

There’s probably a legal notice period for that too, based on your market. 

Purely answering the 80% vs 90% leverage question, in most cases it's better to reach for that 20% down.

The debt is not yours, and unless a question is asked in a way that would subject every investor to having to reveal the debt of every entity he was an investor in, you should have no problem.This is based on my knowledge and experience, I am not an attorney.  

I am based in Virginia and licensing requirements here seem manageable.

Quote from @Derrick Roland II: "but based on my pre-approval"  This is the most important phrase of your post.Where did you get that pre-approval? 

Hard money is lending based on the hard asset and it doesn't speak well when the project is mid-process and now more money is needed to be able to finish it.

I am a CT based investor, flipper and property management company owner.  

.- You both report your share on your personal tax returns and pay taxes based on your own tax rates.3.

Just based on the info you provided I would take the loss and move on.