Should I pay all cash or take an expensive loan?

[Joe Xie]

I am buying a rental property as Tenancy in Common (TIC) at Bay Area and getting a 250K Fractional TIC loan. The close cost of the loan is close to $6500 including everything which is look high to me and the rate is 4.25% 5/1 ARM with cap of 9.25% ( they do not offer 15 or 30 years fixed for such type loan). I have the cash to do cash but that will leave me with no down payment to buy next one (I am still looking for a place for myself as My family just moved here) for some time. The question is should I pay all cash to save cost or take the loan? Since the loan will balloon in 5 years, I plan to pay off it when 5 years comes due any way. A bonus question, I have other rental properties with large equity in them, can I apply HELOC now (for backup) while applying the TIC loan (suppose to close escrow in 30 days from now)? Will the process negatively affect the TIC loan process? Thanks a lot for you time to give advice.