And as with all people they are mostly good but 10-15% cause more drama than necessary but will ultimately work out and 1 or 2 percent are the real trouble makers. 

Under the "Howey Test", a transaction is an investment contract if: It is an investment of moneyThere is an expectation of profits from the investmentThe investment of money is in a common enterpriseAny profit comes from the efforts of a promoter or third partyIn other words, if you are putting together a deal in which people are investing their money (rather than donations, or contributions to a charity), and the money is "pooled", and the only way your investors make money is from what you do as the "Promoter"/Deal Maker/"Sponsor", than it probably is a security, and it probably needs to be registered (at the state, and possibly Federal) level.On the other hand, if you are getting a group of people together, and your are jointly putting in money, and "other services", and equally sharing in decision making (so it's not "all on you) then it may not be a Security, but is more than likely, a Partnership.  

In many cases, the hard money lender is a match maker and goes out and finds a private lender and connects them with a rehabber and collects the points and gives the interest to the private lender.  

It’s a little money maker now though so it’s all good!

I'm asking in regards to either SFH or SMF and long term rental, so I'm not considering snow cone makers.

In 2017 we renovated the space to add indoor plumbing with a bathroom and kitchen as a studio style apartment which we rent on Airbnb.

Love networking with deal makers. 

How does this make renting more affordable?  

@Karma Senge  & @Thierry Van Roy yes I read his "Money Pit to Money Maker" apt book and would recommend it if you're looking to buy value-add properties that need work.

Everyone here just saved me $700 in doors.