We offer 30, 20, 15-year fixed-rate options as well as 5,7,or 10 year ARMs.

I would recommend that you lease it from her at market rates in an arms length fashion. 

Should I go for a 5-year ARM, or DSCR, or try to get a long-term ARM or DSCR loan?

Our investor class is not primarily made up of other real estate investors looking for double digit returns but a mix of accredited and non accredited investors looking for diversity and monthly distributions.

@Andrew AcunaPlenty of arm chair investors that don't know the difference between a shoe horn and shoe molding.Regrettably the majority of tenant problems are created by incompetent landlords.You have read the posts....my tenant regularly pays late.

So there are large numbers of accountants who say it's OK as long as it is documented as an arms length transaction.In this case however, it is an LLC issue. 

My interest rate, if I had financed it would have been +7%+, unless I did an ARM. 

They offer 4.25% interest rate on a 10/6 ARM. 100% paid by the seller.

I honestly don't believe anyone should be paying double-digit interest rates for hard money, and I'm on a mission to change that. 

It would most likely not give you asset protection since its a non-arms length transaction.