Hey all,

So here's my situation: 

1) About 2 1/2 years ago, I partnered with my mom to buy a duplex in cash for $140k, intending to live in one side and rent out the other. We put an additional $17k into renovations, and nearby comps have recently sold for $225-$250k. Our partnership split is 80/20 in my favor.

2) With mortgage interest rates so low, I think the time is ripe to go for a 2nd duplex if I can find a deal comparable to the one I got on my current home. I recently inherited $20k, and I have an additional $25k accessible in savings for a down payment, closing costs, and some light renovations if needed. Right now I'm debt free, save for 3 credit cards which I pay off in full every month & my credit score is in the 790s. I'm primarily looking in Columbus, Ohio because I have strong ties to the area & a few relatives willing to help me scope out potential properties, they have many more duplexes available to purchase, and their market seems to be about where Raleigh's was ~3-5 years ago in terms of what you're able to get for my price range.

I'm wondering if it would be better for me to finance the purchase of my new property with a traditional mortgage, or to use my inheritance & some of my savings to buy out my mom so I can take out a home equity loan to purchase a new property in cash. 

Here are the pros & cons as I see it:

1) Mortgage 2nd Property: With my income & savings, I figure I can qualify for a purchase of $150-$175k (though I'd really prefer to stay under or as close to $150 as possible so I can still have some money left over for renovations or unexpected expenses). Deals for duplexes in my target market are harder but not impossible to come by in this price range. The biggest pro is that I won't have to involve my mom in any way. If I do it this way, the plan is to start saving my profit from the 2nd property to buy my mom out from my 1st property as soon as possible, and once I've done that I'll be free to take the equity loan whenever the opportunity is ripe for property #3 within the next 5-10 years.

2) Home Equity: In theory, I could use my inheritance & some of my savings to pay my mom back for her original investment in my property right now. If my home is worth $225-$250k, I can take out a home equity loan for 75-80% of that without needing mortgage insurance (at least according to what I've read so far). That extra room in my budget could give me a lot more choice as the buying & selling season heats up, and I'd be in a much stronger position as a cash buyer. That said, I don't know if my mom is willing to be bought out at this time, and I haven't thought through all the possible consequences of mortgaging my primary property. It's more complicated because it seems to be a lot harder to find free online resources to help me calculate the principle & expected monthly payments on a home equity loan compared to a traditional loan, and at this early stage of investigation I'm not willing to enter all my personal information into a loan website that'd end up contacting me at all hours with offers I may or may not be prepared to take.

What do y'all think?