Step 1:  hire a competent real estate attorney.Step 2:  learn from your mistake, which imo is when you discovered the tenant was running an unlicensed, unsanctioned halfway house, you should have tossed him and his daughter out, along with all the 'youths with checkered past'.Step 3:  Consider it MANDATORY for owners/landlords to KNOW the state's L/T laws BEFORE leasing the property out. 

If you're doing everything you say above (which is probably more transparent than 99% of wholesalers) then why not just get a license and avoid any of the potential for unlicensed activity? 

What you listed is General Statute (Law) and NC is very serious about enforcement when it comes to unlicensed contractors.

I am an unlicensed, private individual looking to loan money on a home which was purchased to rehab and flip.

There are a ton of unlicensed contractors around here which I don't mind if they are capable, but I don't want to repeat my current mistake and shell out more money for nothing to be done.I'm hoping to get some advice on the following: 1.

All contracts, options, or other devices not based upon a substantial consideration, or that are otherwise employed to permit an unlicensed person to sell, lease, or let real estate, the beneficial title to which has not, in good faith, passed to such party for a substantial consideration, are hereby declared void and ineffective in all cases, suits, or proceedings had or taken under this chapter; however, this section shall not apply to irrevocable gifts, to unconditional contracts to purchase, or to options based upon a substantial consideration actually paid and not subject to any agreements to return or right of return reserved.

It is unclear if he's licensed or unlicensed (I did ask my PM to verify this) but he did all the electrical and plumbing work on the house - and did not pull permits.

@Meng Chen cool idea.Had a local competitor trying to have college kids handle showings and they got a warning from the state Board of Real Estate and Attorney General about using unlicensed personnel for showings (they went out of business).

And or your just getting a bunch of unlicensed basically unskilled day laborers slinging paint.

Other flippers will simply roll the dice and use a mix of licensed and unlicensed subs.