Raising Capital for 1st deal: To Sell or to HELOC that is the "?"

[Tim Broxholm]

BP community!

I am getting ready to launch into RE investing. I am looking at 2 opportunities to capitalizing my portfolio. Would love your feedback and advice on these two options.

option 1: Sell our house.
We've got our house listed and based on feedback. Confident we can sell and get between $40-$50k in net proceeds. We'd then get into an undervalued home and shave anywhere between $200-$700 per month in mortgage.

Downsides: moving, down payment for other house (5% down), most likely next house will need some cosmetic updating down the road to max value
upside: generates capital with no interest, and reduces monthly expenses.

option 2: We are strong borrowers, have w2 income, little debt besides mortgage and 1 student loan, and have established Self employee income. After doing some due diligence have found several local credit unions that will do 100% LTV HELOC. This would generate 90-100k in capital, and we would retain our 20k in current capital for investing.

downside: have to pay interest, doesn't lower payment.
upside: retain strong asset, leverage equity, access to more capital

 RE goals:
1. play the long game via BRRRR's
2. be a value add partner for other investors by providing capital to fund deals and flips.

all of that being said, would love wisdom of some finance ninjas and the BP community!

Thanks,
Tim