Help with my RE strategy

[Mack Lev]

Okay so I own a cheap rental property free and clear and I was planning on using the equity to invest in other RE deals. I'm in the process of raising my credit score to apply for the HELOC but I'm estimating I might receive $40k from it. My original plan was to use that money to go to a tax deed auction to acquire a piece of property, but in Texas the redemption period is 6 months. So using about maybe $15k (my comfort spending limit) from my HELOC, being charged 6 months of interest on that and only getting a (25%) return on the face value of the delinquent taxes (if the owner was to come forth and claim it) is obviously not worth my time. In that situation I would be losing money. Obviously I formulated this plan before I accountant for the redemption period after the purchase of the deed. But moving on to my question, without a lot of cash on hand and only about $40k in equity to invest, what's the best way to go about this for a flip? Using the HELOC as a down payment for a greater loan to increase my purchasing power? (This would result in me being a cash buyer and maybe to negotiate a seller down a notch to equal a bigger flip for me) Using the HELOC as a down payment towards a rental and try to break even? I mean Iam really clueless here on where to start and I would love you guys input. Also, I am only 21, with good credit, and a good job. If that helps. Thanks in advance! -Mack