There must be a much larger amount of people who take the gamble and fail that we don't hear about than I thought.

Some examples of good reasons include:* Evidence that the borrower obtained the HELOC fraudulently* A documented poor repayment history* A decline in the value of the property used to secure the loanIf you were relying on the line of credit as your primary source of funds, and the line gets frozen, you may need access to other funds to finish your rehab project. 

Lastly, everything is more expensive than you think, and as I understand it, it is more challenging to be a landlord in California.If you are betting on appreciation in the future, that might work, but it is a gamble.

You must file an accurate return.Not reporting expenses overstates your profitability.While the IRS may be happy and lenders can improve your DTI ratio...It is in not accurate to do so and can be fraudulent if done intentionally.

You could also rent it out and eat the cost of the extra mortgage until the equity rises but at that point you are gambling.

Their in-depth knowledge and access to comprehensive background checks, credit reports, and rental histories enable them to meticulously assess individuals and identify any red flags that may indicate fraudulent activities.

A lot of people apparently operating in very shady ways and even fraudulent without caring about their reputation.

I also like having more control over payment processing to weed out the fraudulent charges.

You did well with the appreciation gamble. 

I could have  bought a 2 or 3 million dollar building made 100 k net a year instead of spending it .. but never have a potential 30 mil upside.. so yes speculation and gambling thats what we do.. but we also use our noggin to buy the right properties.. not just some rental house and hope for the best.