Hi guys! Ok, so here's the situation....I'm a newbie RE Investor and had plans of going into business with a friend who I've known for over 20 years. This guy has been in the RE business for the past 20 plus years and seems to know the business very well. I never had any reason not to trust him and was excited to get started. Soooo, the first deal we agreed to was somewhat of a JV on a flip project he's doing here locally in California. We had agreed that I would fund half of the rehab ($40k) and receive an 18% ROI. He took me to the property, we met with the contractor that was going to oversee the rehab, we looked at comps in the area, etc. The 5 page agreement he provided me with is titled as a 'SECURED PROMISSORY NOTE' for the amount of $40k plus interest of 18%, and on the last page, states at the bottom, * SECURITY - NOTE SECURED BY 2ND LIEN POSITION DEED OF TRUST ON SUBJECT PROPERTY, and then lists the address of the property. Now, this secured promissory note isn't notarized, he just signed it and gave me a copy. I've since spoken with with a few people in the RE business and found out that it's meaningless unless it's been notarized, so I plan on having him draft a new one up so that we can have that done. HOWEVER, I never looked into that until just recently, again, because I figured I could trust this guy. But here's the thing, he and I were looking at doing a JV deal with a team we met out of state just last month. This was going to be a flip we had lined up and we were going to be using hard money for. So the agreement was that I would provide 10% of the down payment, plus the 3 points, and he would cover the carrying costs. So my total investment on this deal was approximately $24k. Since he had several flips under his belt, we were going to fund the deal through his LLC in order to get a better rate with the hard money lender, so I wired my $24k into his LLC account to cover my half of the deal. Come to find out, he had some back taxes that he owed and therefore the HML had to change the terms on us and the numbers were no longer going to make sense, so we backed out of the deal. Not a big deal, I was disappointed it didn't work out, but figured I'd just find another one. Wellll, when I asked my so-called friend to wire the $24k back into my account, guess what....he didn't have it!! He claims to have only used half of it and has since wired $7k back to me and claims to be working on the rest. Mind you, I just found this out this past Thursday. So obviously he's not to be trusted and has ruined a friendship as well as a potential business partnership. But my question to you guys is, (and I apologize for such a long post) after I get the new 'Secured promissory note' notarized, should I, and CAN I also have a lien put on the property I invested the $40k in? I've been looking up 'Liens' and I'm not sure if my situation would qualify for a 'Mechanical Lien' or not, or if there's some other step I can take to secure my $40k. Any information or suggestions anyone has would greatly be appreciated. Thanks guys!