The restaurant currently does over $1 million in sales annually, and they’re only open 5 days a week for dinner.

Annual return is 12% and you get your principal back after 3 years I believe. 

I would lend that 130K in short term lends at 16-20% annualized turning that money over every 6 months and use the returns to buy real estate.

Will be far easier to purchase more property with 10% downpayments vs 20-25% for each one.Umbrella insurance isn't too expensive, $2M for $1200 per year.Just be sure to run the properties as a good business, address any concerns brought up by the insurance company (they usually do annual inspections). 

Here's the terms:FOR VALUE RECEIVED, XXXXX a limited liabilitycompany (hereinafter referred to as "Maker*), hereby promises to pay to MY NAME,whose address is redacted (hereinafter referred to as"Holder"), or order, the principal sum of $XXX,000.00 in legal tender of the United States, accruing interest at an annual rate of 18.0%.

There are stated or no income 2nd mortgage loans but typically these are fixed term and fixed payment type second mortgages meaning the interest rate usually doesnt fluctuate like a HELOC or home equity line of credit would fluctuate (prime + margin = annual rate calculated based on a monthly basis). 

Other Security for Payment: None Promise to Pay Borrower promises to pay to the order of Lender the Principal Amount plus interest at the Annual Interest Rate.

As you're probably aware, AB 1482 caps annual rent increases at 5% + CPI or 10%, whichever is lower.

Your annual payment is $220,816.35.

I could sell the property and net $170k and then reinvest that and earn 9% interest annually via lending hard money.