@Brian Dombrowski any time you are providing private money, whether for equity or as a loan you best bet is to have a lawyer that specializes in RE draw up the agreement and assist you with the structure.There are a dozens answers to your question depending on many items, with who and if all the investors are under the same LLC etc. etc.Every investor I know that has done private financing had their lawyer draw up an agreement that the "borrower" accepted and signed. 

Steve speaks to the mission/goal of what he is providing folks in his community AND about how he is trying to create a legacy for his children by immersing them in the business, having them put in sweat equity, etc.-- which is EXACTLY my why....   

 Yes you can use equity in a property for a cash out loan to fix the property or you can get a construction loan on the property based on the after repair value. 

I would love to get the opinon of other bay area folk who have considered this and/or doing it.Heres my thought process--> 500K equity in current home--> sell home--> find a househack in either Oak, San Leandro or Alameda ( sticking to these areas because I want my kids to remain in the school they are in).

Usually rentals are a long term equity strategy.

Then value add an ADU (as large as you can build - 1200’ + giant garage (4 car: think repurpose later) for instant increased equity.  

Is it a personal move or are you cashing out your equity that you are looking to use for investment purposes? 

would you take $100/door if you also made a 50% increase in equity?

There is always a little sweat equity to make up the difference!

A lot of the issues were derived from our equity group partner in reviewing the insurance policy Kevin provided along with the confusion on the registration of the parent company not having a foreign registration.