Starting out for first rental property

[Kenneth Rodgers]

So I am very new to this. I just acquired a house from a family member that has tenants in it. The house is completely paid off.

I am wanting to take an equity loan out on the house to finance a new rental property. There are all kinds of things running through my head about this.

I figured I can either just take enough for a down payment and just make the payments on the equity Loan and then the mortgage or I could fund the entire new rental property with the equity loan, get a mortgage on the house and then pay back the equity loan to free up the credit line again.

Any thoughts or suggestions? Also. I’m really new to this part of investments. If I do the second option do banks require a down payment? I don’t know how that would work if I own the house.

Any suggestions would be greatly appreciated.