Make sure you know the value the ADU will add to the property before building the ADU. 2) the financing on an ADU is typically far worse than for initial investment property acquisition or is often not leveraged (HELOC, cash out refi, etc).

If you are doing a live-in flip why not use that equity for a down payment with a refi or HELOC?

We have equity on our SF and we’re thinking of using a HELOC.

Alternatively, consider bridge loans, HELOCs, or post-purchase refinancing to preserve liquidity.

I know it would have helped me.Now that I am out from under these two properties I am waiting on a HELOC on my primary to get approved I will be getting right back on the horse but with much smaller rehabs.Below is the house that sold today.

Several options you can explore to get the down payment capital: Solo401k; HELOC on personal residence or from equity of the SFR; Cash Value Life Insurance Policy; Business Credit; Private Lenders, to name a few.

Took a HELOC out for $60k.

A HELOC could help temporarily if you plan to payoff the balance quickly and are planning to save on monthly payments in the short term.  

Don’t forget heloc, DSCR, 2nd on primary, borrow from retirement accounts, credit card cash advance, property reserves, home improvement store credit, etc etc.

Alternatively, your sibling might use a 1031 exchange to defer taxes by reinvesting in like-kind properties, though this doesn't directly fund a primary residence.Other ideas include leveraging a HELOC on the rental properties for the down payment, taking out a 401(k) loan, structuring an owner-financed agreement, or a lease-to-own arrangement.