Its always nice to hear positive things about local people. 

You could theoretically structure a deal where you are cash flowing negative, but have an overall positive ROI.

Am I in a bad position.

Building equity in your house is one of the biggest financial advantages of homeownership.

The amount of equity I call pull is less than the cash I have but not significantly less.When doing this analysis it struck me that it may not be worth using a HELOC for the simple fact that the interest rate is ~9%* while the funds in my high yield account are only yielding ~5%*.

Also, if you were in our position, what questions should we be asking the lenders to make sure it is a good fit?

I'm in favor of a higher bar before posting but I think it's a minority position. 

They have equity in a property or two and are hesitant to deploy it.Other investors I have worked with have found if they deploy this equity into a newer property as 25% down payment, they are able to find deals that work very well. 

The seller would use this strategy when they don't have a lot of equity in the house.

I'm not sure I can copy and paste my Excel spreadsheet, so i will approximate the numbers here.Strategy:Take a Home Equity Loan (second) on our primary @ 5%.Pay off existing HELOC (variable, at 7.5% now), use remainder ($120k) to buy the land (plus 30k of our own cash).