SBA's regulations on leasing require that the small business occupy at least 51% of the rentable property if the 504 project is for an existing building and at least 60% of the rentable property (with the intent to move into at least an additional 20%) if the 504 project is new construction.Eligible Borrowers: For-profit, non-publicly traded businessesTangible business net worth (including affiliates) not to exceed $15 millionAverage net income of the business not to exceed $5 million over the previous two yearsOwnership must generally be comprised of 51% U.S. citizens or Legal Permanent Residents (some exceptions apply)Examples of Property Types Fountainhead Finances:Medical offices or medical facilities (such as labs and clinics)Office buildings (including office condos)Warehouses (and other industrial properties)Day care facilities (for children or adults)Free-standing restaurantsLimited-service, flagged hotels (some unflagged destination hotels will be considered)Auto repair shopsAssisted-living facilitiesCall to ask about many other property types that are eligibleIneligible Borrowers: Non-profits (except sheltered workshops)Passive holders of real estate and/or personal propertyLending institutions (mortgage brokers and correspondent lenders are eligible)Life insurance companies (franchised agents are eligible)Businesses located in a foreign countryBusinesses selling products or services through a pyramid planGambling concernsBusinesses which restrict patronageGovernment owned entities (excluding Native American tribes)Consumer and marketing cooperatives (producer cooperatives are eligible)Businesses engaged in loan packagingBusinesses that have previously defaulted on a Federal loanBusinesses engaged in political or lobbying activitiesIneligible Use of Funds: Working capitalInventoryRolling stockBusiness “good will” or “blue sky”

I read somewhere that the new thing for ownership is to take possession in a trust as opposed to an LLC because banks and financial institutions view a trust as an individual and not a business and will offer faster and better financing to you and whoever your buyer is in the future.

DISCLAIMER:  I have no affiliation with Memphis invest, I just find the information that Chris Clothier shares very valuable.Hi Robert,The only problem is conventional only allows a maximum of 75% on the cash out of SFR's when the borrower has 1-4 financed properties, perhaps you are referring him to portfolio lenders and credit unions who can sometimes be 70-80% depending on bank or institution.

Another questions... are HM lenders sometimes just individuals and not an "institution"?  

NNN investing is based on credit of the tenant and strength of the lease along with location.REIT's ,institutions, private funds love NNN properties.

Two reasons HML types represent themselves as a private lender, marketing as if the relationship is non-institutional by nature, seemingly one to one and the other is to avoid regulations.

The suit between your buyer and another lender may carry a bit of concern with another lender too, the nature of that needs to be known, if the institution lost and was clearly involved in some illegal or bad practice, it may be overlooked, if there were contributory issues on their part and in the end, they won, it may be viewed differently.

Isn't a VOD issued by the banking institution that you have your funds sitting in?

With that said, O.F. a property (and doing it properly) can increase the price you get for the property because it opens it up to a larger pool of buyers...buyers who can not get institutional financing and therefore will pay a higher interest rate with terms more favorable to the seller.Most investors balloon the payment in 5 to 7 years, but you could certainly do a straight 30 year amortization with no balloon.Some states are judicial foreclosure states and some are non-judicial foreclosure states (like Texas), so you would have to address that with a real estate attorney before you consider O.F. 

Family is the most important institution.