When its included in a lease for real estate then the laws pertaining to residential rental security deposits in your state apply but when its separate you should have more leeway to get some additional deposit to protect you.

If you buy good properties in good locations you can do fine in Buffalo. 

I completely agree with @Ashish Acharya's points about the cost-effectiveness of a HELOC and the potential credit implications if it’s secured by your primary residence.

Location, location, location. 

You're right, I definitely do not want to force a bad deal just to avoid a relatively small amount in taxes.This morning, I spoke with the property assessor’s office in the county where my property is located.

It's a 5th wheel located at a campground.

I’m currently targeting properties in the $200K–$500K range, depending on the location and potential cash flow.

@Hank Bank where are you located?

@Joe Gellenbeck Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a Class A property in Class D area, what quality of tenant will you get?

We plan to stay in the new primary residence for a long time because we love the location, the neighborhood, and the land.