I love Humboldt Park @Melissa Wongkamalasai - for sure, one of my favorite Chicago neighborhoods. 

A minimum 20% down payment allows for more cash flow but higher monthly payments. 25% down offers better interest rates and lower monthly payments, while 30% down can improve cash flow but reduce liquidity.

Let me know what you guys think I have about 70 K in liquid cash $250k in a heloc , so total is $320k I’m working with Option 1: Go 5% conventional on a two family home which would be about 90 K with down payment and closing costs , I am preapproved for 950 K .

Those are my favorite deals- they don't understand their rights within their own contract or state law when i comes to real estate transactions.

Hi Everyone,I've been saving up and now have over $150k in liquid funds.

That may be the most practical resolution but if they stopped paying interest they may be struggling with liquidity. 

It secures the loan with equity from the current portfolio, so providing liquidity for the down payment.

Could I do itemized deduction on a schedule E as an individual?

You will need significant liquid funds though for down payment, closing costs, and reserves. 

And keep in mind the favorite enforcement strategy of the IRS: they go after the promoter first.