If we do that we would be looking at adding roughly 120k in equity.

If you consider for every 100K in equity, with a mortgage rate at 5% you are losing a minimum 5% annually on every dollar of dead equity you hold.

Those also aren't numbers that will have flippers jumping through hoops to buy it at, but my friend still has a potential opportunity of not moving from his home of 7 years, AND capturing $30k+ in equity.  

As far as the financing, I have about 25k in cash to start and another 55k in equity in my house if I needed to temporarily borrow from that.Id considered buying some properties in the area that I work and currently live.

So I'm looking for some advice, settle in this is a long one.I was lucky to pick up two house in Grand Rapids a few years ago before prices shot through the roofHouse 1 has a 43k note and could be sold for 120K (I've lived in it more than two years with in a 5 year period so I can get out of the capital gains tax) leaving 77K in equality, but the house is currently nets $700 a month in rent.House 2 is right next door, has a 53k Note on it and could sell for 110k, leaving me with 45k after capital gains tax.

I'm looking at a HUD home with potentially quite a bit of built in equity, as well as improvements I can make to force appreciation.

With your 600K in equity you could buy about 2.5M of rentals in the midwest that would bring in about 25K per month of 300K per year.

I'd prefer to take the house hacking approach with a duplex, but another route I'm considering is buying a house with built in equity that needs some fixing up and can force appreciation.

So I am going to plan for 675k.I am prepared to come up with 25% down if need be but am hoping I can get some of that in in built in equity I can tap in to.Thank you for any advice and comments,

We are pre-approved for 200k with a mortgage broker.After doing some reflecting I realized that I may be backing out off plan A without exploring other options.I currently have a rental property with about 90k in equity.