Question regarding financing- what to do...

[Christin McKamey]

Hello, I feel like my mind is going off in a million directions and just want to get some feedback from those more experienced. =) I am planning to buy my next rental property (hopefully a multifamily if I can find a good deal) in the next year and a half. I own 1 single family home free and clear that's worth around $70K. I also own my primary home outright (worth $250K) but would prefer not to take out equity on my main residence. I'm wondering- is it better to just be patient and save up $ over the next year to year and a half (I think I can come up with $50K or $60K) OR is it better to use a HELOC or equity from my rental property to use as a down payment for a new rental property NOW? I guess I'm not really understanding why people don't take more time to save up cash and if it's a good idea to move on something when I don't have the cash to do so.

I'm generally a pretty cautious person with a debt-free mindset, so I'm struggling with how much risk to take and when. Any help is greatly appreciated! =) 

[Jeremy Taggart]

@Christin McKamey You could always get the HELOC on the rental just to have it in case a killer deal pops up. You won't pay interest on that unless you actually spend the money. All in all though, it comes down to what you are most comfortable with. Some people are more comfortable being leveraged and some are not. I wouldn't take out the HELOC and utilize it if it is going to keep you up at night. Which at the end of the day that is what matters the most. But you also don't want to regret not being in a position to buy that great deal that might pop up too.