@Justin Mespelt I am in a very similar situation. I recently acquired my first LTR property via traditional method (found a turnkey property that cash flowed and got a 30 year mortgage). While this is working out great, I have the bug to acquire more properties and the traditional method is just not going to allow me to progress as quickly as I would like. I have a good amount of equity tied up in my primary home, so I started looking into using a HELOC to fund my next investment.
I ran the numbers on using a HELOC to buy properties via traditional methods (either buying in cash or using HELOC as a down payment for a mortgage). Neither of these are going to work well. Buying all cash and paying off the principal and interest on the HELOC is essentially the same thing as just having a mortgage -- it will take 30 years to fully recover the investment! In the other scenario, you would need enough cash flow to cover the difference between your interest rate on the HELOC and the mortgage payment, which would typically be difficult to do unless you can find properties that are very cheap and cash flow well.
With that in mind, BRRRR is really the way to go with this. If your wife is nervous about it, then start with properties that need lighter rehab (maintained well, but hasn't been updated in 30 years or clean, but you could add an additional bedroom or bath to build equity). In the end, you might not net as much return, but your risk and her fear are also mitigated. Once you have done it once or twice, then maybe you will feel comfortable enough to take on bigger projects that can offer larger returns.
