Financing thru Equity

[Stephen Scire]

Hello Bigger Pockets friends ... I have a question regarding funding.

I'm interested in scaling up ,...I currently have equity built up in 2 investment properties...they actually have no mortgage on them.

I also have 30% equity in vacation rental property & 60% equity on my primary.

Here's my question...using the equity on the 2 multis with no mortgage, can I use that to do a cross collateralization loan as a deposit on a new purchase. I just heard of this idea & wanted top see if it's doable & if anyone has done this. I'm hoping of course that there is no penalty to use my equity (avoiding PMI) & this way I can do the deal myself without a partner or multiple partners for extra cash for the 20% down.

I do have cash reserves, not enough for 20% deposit to scale up to a small apartment building ( 8 to 12 ) units but I'd rather keep for rehab or just to stay more liquid. Naturally in a year or 2 I do plan to refi & release that property from the purchase. 

Thanks for any advice & education

Steve