All said, the most conservative of title companies usually will grant you title insurance at 4 yrs of your ownership as statute of limitations but others can/will be more aggressive depending case-by- case given the above variables.

To many variables involved and without any guidance will cost you dearly. 

My main concern about keeping HELOC funds sitting in a property is the interest rate is variable and your putting cash flow at risk.  

Hi @Khaled Fawzy,It seems like the seller has something to hide if he/she does not want to provide you with a real appraisal.The income valuation approach is useful for determining what a building is worth now, but yes you obviously have to factor in other variables. 

We have a $490K mortgage (3.5% fixed) and a $140K HELOC (4.5% variable; used to renovate residence and buy vacation rental).

Is it possible to obtain a variable-rate loan on the HELOC, so it "hopefully" is cheaper, and if interest rates rise, you make it your priority to pay that off ASAP?

My wife and I were making HH income of $160-190k in an average COL market (variable based on my bonus and her self-employment income which has increased from 45k to 60k over her first two years and is on track for at least 60k again in 2018. 

The cap rate is the toughest variable.

You'll learn something along the way and be happy you did it after.The other variable here is the financing situation. 

Just make sure you pay attention to other variables, like how fast the immediate neighborhood is improving, what shape is your target property in and is it attached to dependent property, etc.