From my understanding, you would go to a bank and tell them you want to take a credit line out on the equity you have on current home. They probably won't give you the full value, but some to most of the value of your home. You then have a credit line that can be treated like a credit card. You can offer cash on a property, using your credit line to pay for it. You'd then go to a bank and get a mortgage, pull your money out, replenish the line and repeat the process. Hopefully you'd buy a cheap deal and add value, so when you get the mortgage you'd also make money as well as replenish the line of credit. There are also interest payments just like a credit card would have. I've never used this method but plan to in the future, but that's my understanding of how it works.
