Anybody ever heard of using a HELOC to pay mortgage for a year?

[Joe Einbinder]

Hi all!

So I have an interesting situation going here and I have to get creative to make something happen or I''ll be stuck in the paralysis by analysis phase forever! I will try and sum up my plan as quickly as possible, bear with me!

My wife and I currently live with my mom. We own a condo free and clear, that we rent out, at a net profit of about $600 a month. We are living here because we are both going back to school in the fall, and need to downgrade our work schedules a bit in order to manage everything. So in other words we wont be making much through the next year or two, and are eager to get an investment property going/ move out of of my moms. We have about $25,000 in cash plus the $165k in equity in our condo. Most people I've heard of, using a HELOC, will use it as down payment on the new house, but I'm thinking of instead using it to pay our mortgage for a year or so while we're in school. That way instead of putting a giant balance on the HELOC right away, we are putting smaller balance on it every month, with the opportunity to use any leftover funds to pay it off as we go so that it hopefully doesn't get out of control. The single family houses we are looking at are 2 bed/ 1 bath priced from $180k - $215k and we will not buy unless we are sure they will cash flow etc. (South Minneapolis).

Anybody say go for it?? Or do you have any other ideas for us that may work better?

Any input will be much appreciated for these two novice investors! 

Many thanks, 

Joe