The answers on licensing and entity selection are dependent on the state where you are doing business.First thing, you gotta know the law, both state and federal, related to lending money on property in the state where the property is located.As for asset protection or tax liability, don't take advice here. 

Basically, I want the most efficient way of dealing with moving money around within the LLC without doing something stupid to shatter my liability protection or mess up my books.Thanks for any advice!

Without a security deposit you have no protection or at least a cushion to bridge the gap if/when they default or trash your place.Personally I would hold off for a better tenant apllicant.

Do RE attorneys also do asset protection or is that a separate part of law?

Also, can you restructure an LLC later as my business grows for better asset protection or just create more. 

Are there services available that specialize in rehab protection or security?  

Does the umbrella policy provide protection or just a means to pay out to someone if they sue?

Do you have significant assets or multiple properties that need protection, or if you're just starting out and you have less on the line, and the extra cost of a commercial loan is significant to you, you have to weigh the potential impact and risks associated with each.

You can branch out further for asset protection or corporate structuring (like separating active income from flips and passive income from rentals), and probably even further for federal or tax issues.

One of two things happens: they forget to do it, so they don't have the LLC protection OR they do quitclaim it over and they have triggered the due on sale clause in their mortgage contract.