Due to the low amount I will owe to the hard money lender I want to get a HELOC to find and fund other deals but when I am not actively doing deals I want the cash flow.

Invest in Opportunity Zones: Reinvesting capital gains into Qualified Opportunity Funds, which invest in designated low-income areas, can defer and potentially reduce capital gains taxes.6.

This demonstrates a significant difference of $132,000 in earnings by leveraging your funds and investing in multiple properties.

Give the cost of money these days is around 7%, it would definitely be nice to have a paid off rental.7% cost of money sounds like a lot until you remember that it is actually the tenants that are paying it for you while your money is sitting in an index fund making 8%.

You can do a 12 month cash out bridge which will pay off your old loan and get you funds to do the rehab as long it appraises high enough

This is what I think I know:- The borrower can choose to pay off the note at any time (by selling the property or just paying off the loan with other funds), so it is important that the legal balance covers my investment and some profit- The borrower could file bankruptcy (can someone confirm that this will only cause delay, but not jeopardize ultimately collecting the legal balance of the note)- Most of these DOTs will have a rent assignment clause, so I could try to enforce that and collect rents from tenants (essentially manage the property) while I am holding the note and trying to foreclose.

Remember its an Investment Fund.

Using your own funds to pay down your loan so you get a bigger loan sounds like a zero sum gain (aka IE using 1 dollar to pay down loan so you can net 1 more dollar from the new proposed loan) So how are you going to net more cash when spending 1 dollar to get another 1 dollar ?

Don’t fund the additional 25 unit add in with your money.  

LOC on business purpose doesn't really make sense from a lenders perspective.Think about it, you have to tie up funds and not earn a return until the borrower wants to use them.Time is money and if your lending money you want a return each day your money is out.I'd strongly recommend just going with a cash out refinance and avoid spinning wheels looking for a LOC.