@Scott AndersonIn the past I've funded some deals for others but now I'm striking out on my own so I'm a bit of a newbie too from this angle.  

Unless the business has readily salable easily repossessed assets that are valued for quick sale in excess of the loan amount, and those assets have not been pledged via a UCC filing to trade accounts or other liabilities, you're banking on the continuity and profitability of the business itself.Small businesses are notoriously difficult to evaluate since the quality of their accounting varies widely; the key personnel play such a key role; their market position can be devastated by the emergence of a key competitor, the loss of a key account, or the exodus of a key employee.That is why companies that buy receivables from small businesses target returns of 36% plus, and often the risk is so great they layoff some of the risk by partnering.  

We have a flip going near Dallas, about 75% of the house has the original 1.5” wide hardwood planks.

If you have a liability claim situation and the attorney for the other side is taking a negligence angle against you there is a possibility they can pierce the LLC and come after you personally above and beyond what your insurance policy pays out which is why having a quality insurance policy up front is the best defense.

Nevertheless, regardless of what comes our way as @Steve Vaughan, mentioned we need to stay plugged into our local and state wide networks for helping us to protect our selves. 

Sometimes, as in the case of Colorado Springs, the city is busy working on regulation and it's not widely known. 

 @Jackie Sladky  I attend a wide variety of local meet-ups and I promise every type of real estate investor is welcome and encouraged to attend.

You left your front door wide open with a pile of cash sitting on the table and someone came and stole it...are they a thief, sure, is it your fault...YES it is.The same thing just happened here..

Long as you've considered all the angles and it fits your goals, I'd say go for it!

The house has a wheelchair lift, roll-in shower, wide doors, the works.