You may want to research the term ' Debt Financed Distribution' Which does have a tax implication for the investors receiving a distribution.

Its good to see that there are no issues at this point. 

i also had HVAC mystery issues in my first duplex when we house hacked it.Regarding the Daikin Mini Split - I have one in the 3rd story of my current home and it seems to work great for us. 

I would love advice from the community on this issue.  

The client can distribute proceeds through a private agreement without involving the title.

I believe this is the issue at hand its the collateral.when you look at NPN pricing you will see this.. 

Several factors indicate the company is not that concerned about efficiency or ease of customer process: the website, a process that seemed to focus on one issue at a time instead of all issues at once, and consistently poor communications and lack of common sense from the loan analyst we were assigned.It started off very well with the initial point of contact, Austin Lornson, who did a fine job of explaining the general refinancing process, responding quickly and thoroughly to our questions.

They seem to have a good team but this is something not thought out it seems , in their support I do have DSTs which have had the same issue and have not been making payments. 

It would be wise to rectify it before transfer of title so your starting off clean and hopefully won't have any issues when you go to sell down the road. 

If I had to speculate, I would say they are facing some serious liquidity issues.