However, this means they do things like hold your personal credit hostage as collateral, and charge very high interest rates!

I also understand the value of the knowledge, systems, software, marketing collateral, and standard operating procedures we have spent countless hours developing over the past 13 years.

Buy multiple properties with cash and then set up a Line of credit with the properties as collateral..That way you have the funds available whenever needed, but are not paying interest when the money is not required.I personally am trying to acquire 1 house per year paying cash for them.

Try to find a needed niche (in seattle,  anything that would be considered affordable)  and provide that kind of housing.Maybe consider investing in a REIT or other type of investment vehicle instead of indivdidual properties,   or provide loans/collateral for locals who are rehabbing or otherwise improving things and know the market and neighborhood/region.Good luck.

The rate will be around 3% over fed funds rate (5 year treasury)The borrower is the seller and so I plan to use the house I'll lease as collateral.

Start the process of choosing an SBA lender to work with & collaborate to get your financial documents in order, it's not a slam dunk process.The more investors involved the more arduous the underwriting of the loan will become.In many instances the SBA required cross collateral (pledging your primary residence as collateral) just be prepared for that.

I'm 19 years old with NO Collateral as well.What's a young man to do in this situation?

When you have more than 3, it falls outside limited partnerships of small entities, was funding equal or was one in for more than others, was collateral properly attributed to investments, is their management by a non-investor, all these aspects paint a picture of the entity, it's formation, purpose, use of funds, how were funds solicited, any prior business relationships between partners?  

@Gagandeep Thandiin order to qualify for a conventional loan, you would need the income, credit and collateral.

I ended up winning, but if underlying collateral piece of junk you could easily lose money.