HELOC and how to use my homes equity

[Jeffrey Pence]

My wife and I inherited a house 9 years ago with a value of 185k. We have been renting it out since then. The value is now 480k and I would like to take out a HELOC (or get a mortgage?) for the property and use that money to upgrade and put towards a new home down payment that we are buying. Rent is $1700 and our only expenses are property tax (Utah), insurance, and occasional repairs. My wife currently owns it in her name. Should we form an LLC and have the LLC get a mortgage and purchase it from my wife. I am obviously confused by this basic step.

I thought about taking 240k. Seems like a good amount we could use and still cash flow slightly. Just wondering if there is something I am missing or if there is something else I should be thinking about? Do I just call around and get some quotes to see who can give me the best rate.

Thanks!

Would like to hold the house long term as an investment p