I think a HELOC requires a certain LTV before you can pull any equity and 1 year most likely won't be long enough for any real equity to build.I would say.

It likely would require something grossly negligent with huge consequences to have a chance to go beyond my coverage and we are not that negligent. 

Insurance and LicensesThe Subcontractor agrees to maintain:General liability insurance of at least $[Insert Amount].Worker’s compensation insurance (if applicable).All necessary licenses and permits required by law.6.

There is no license requirement for contractors in Texas.

again, not sure if we're talking about the same thing or not. i assumed you meant using the low interest loan for the down payment, and a DSCR loan for the balance. 

This loan doesn't require any certain length of ownership seasoning or equity. 

Another note on construction cost, going vertical is very expensive now and would require have a great connect with a developer and a builder in the area.See what rents are in the area and run the numbers to ensure the rents will cover your costs and give you a solid return—using the 1% rule can help.

I have focused my research on house hacking due to the lower upfront capital requirements with an FHA loan.

We do all our loans as balance sheet loans, so that means short term fixed rates with 20yr amortizations and 20% down. 

Some banks required us to get full apprasial if loan was over a certain amount 500k. 5.