I can't think of anything riskier than taking a HELOC out of your primary home and using that to make super aggressive loans that are unsecured.if you want to make aggressive loans and arbitrage that against the higher yielding loans, at least make loans that are collateralized.

Is there a funky property tax issue that arises with the collateral that is a local municipality error and can lender quickly analyze the situation, assess and articulate the risk and allow draws to carry on or will they make the life of the borrower miserable?

Dumb Debt also means that the owner takes on recourse debt and personally guarantees it instead of non-recourse debt or other people’s debt (OPD) or cross collateralizes it with highly appreciated assets with low debt to value ratios.

what is the collateral that Norada has secured for these funds if any..

As stated, most lenders will require some level of capital and will want you to show collateral.   

We are all confused about what role a private lender plays, so here is a quick and dirty explanation.Unlike prime lenders (ex. big national and regional banks like Chase) that underwrite both the borrower's ability to repay the loan and the collateral (ex. real estate), private lenders make lending decisions based on the collateral. 

Hey @Thomas McPherson,I've heard that CABIs (Collateral Assignment of Beneficial Interest) can be a fantastic tool for scaling your lending capital!

Again, use the digital collateral available to learn about who they are and hear more from them.

Do you have the Capacity/Ability to close, do you have the Character/Credit to close (including relevant experience), and do you have the liquidity to properly provide enough collateral (are you injecting enough into the deal).

That gives an investor a real asset to collateralize and it gives them incentive to not let the buildings dilapidate at the end of the lease.