I do it mostly for the principal and commission savings are easy pickings on my way to my annual goal of  saving $90k per year.Here's how skewed the statistics quoted above are though, the ones saying listed property sells for $60k more. 

As part of this, can someone share their thoughts on whether debt service (principal and interest payment) is considered a fixed expense?

Cash-out is a last resort...credit unions can go to 98% LTV on a HELOC with a 15-yr payback period on a 30-yr am schedule...true interest only payments...you only pay on the principal...But in general, yeah- HELOC makes more sense. 

That way you benefit from the principal reduction.Did she buy this at $218k on a 3.5% FHA by any chance?

  $4k interest for 6 months with a principal of $50k is 16% and is a totally different consideration. 

I put a disclosure that I am the principal in the transaction not taking a fee.. and I am buying for PROFIT or LOSS  … they sign and acknowledge that.. and if they want to sell for what I want to pay .. deal is done.if your think your going to tell someone their house is worth X when its really worth Y just so you can make a big spread that is greater than your commission or tell them your not taking a commission.. then that's your choice..Although do keep in mind most wholesale deals are distressed wrecked houses that need rehab etc.. and commission are negotiable.. there is no law of charging a higher commission for tough to sell properties.. if that is what your aiming to do.. 00I worked a builder out of a 22  duplex's he had built was having a tough time selling.. he wanted 30

The savings principal is backed by a solid asset. 

I need help getting a HELOC on my principal residence. 

Your offer is no money down, and pure principal.  

My numbers are based on net return and include principal & interest loan payments, insurance, estimated taxes, utilities (i have to pay them), and property management.