I’ve actually used the forums here as a legitimate source of information as so many people do the groundwork for you in regard to interpreting new laws and various calculators.I have always dreamed of passive income.

@Jeff Weissman It's interesting how we all interpret words through our own experiences.

As you get further away from standard real estate practice, the risk is increased by a “legal” risk that your protection may be interpreted quite differently than you expect by a court and that the subtleties of the protection a mortgage or trust deed document provide with established law and court decisions handed down for (in the U.S.) 250+ years is not existent. 

I interpreted the question a bit different, and it's similar to a question I have (also a newbie).

Insurance policies can be sneaky when interpreting damage.

I did some research and found the following table describing 506(b) vs 506(c) offerings:The way I interpret this is as long as there is a pre-existing relationship with the investor(s), there should be no problem, correct?!

I would be curious if there is a different interpretation from sponsors but presumably they are checking your registration when you apply as an investor under this new definition, and if you aren't registered I would think they would not allow you to invest regardless of if you passed the 65 or not.   

Tracking down all of these documents takes a lot of time, effort and communication, and then once you have the documents, you actually have to read them, interpret them, and figure out how they apply to your situation and your applicant's situation.

Looks like you've hit a hiccup with your lease agreement and a tenant who's found a loophole.The key is that technicalities matter, and while the phrase "paid before move-in" seems straightforward, it can be interpreted differently.

In your case, there is room for interpretation.