Question about downpayments with the BRRRR strategy

[Juan Contreras]

Hey everyone. I will be using a HELOC to fund the purchase and repairs of a distressed property. I am planning on using the BRRRR method. Based on what I have learned, you never want to go over 70% of what you estimate the bank will appraise the house at. However, I am unsure of how the bank deals with the standard down payment on a mortgage.

If I do BRRRR do I still have to pay 25% (two family) for the loan? Or does the bank only offer 70% because they kept the other 30% as equity built into the home and that functions as the down payment?

For example:  

I buy a home for 100k.  I put 100k into repairs into it totaling 200k. The bank says the house is worth $280k and offers me the loan on 200k because it is 70% of the 280k.  Do I have to pay 25% of 200k because I am opening up a new loan?  Or is the remaining 80k already built in equity?