@Fulati PaerhatiA 1031 exchange is a powerful strategy to defer capital gains taxes and grow your rental portfolio.

As a due diligence footnote - a few submarkets are prone to severe flooding.Nearby Frankfort (state capital) is seeing growth.  

• Is this a better strategy than using your own name, capital and credit to start out?

Like you said, I want to seed different strategies I can implement with the limited capital I have.  

What is bad is having the gurus collect money from armies of inexperienced, unknowledgeable and under capitalized wanna be investors who then seduce desperate home sellers (who have no idea what they’ve agreed to) into selling their homes without understanding the consequences.  

I have about $100k in capital reserves and can leverage the 2 properties for additional capital, as needed.

I also wouldnt let your mom go into 2nd position on an investment property with any sort of restructuring; it doenst sound like she's in a position to risk being wiped out.Overall, though, if you want cashflow on the new property but cant achieve that after a refi into a market rate loan, it probably makes more sense to just flip it, pay off your heloc and your mom, and use the remaining capital for the next deal.

Are you starting with some available capital or other investments that you can turn into cash to buy a deal?

However, have you ever gone downtown to the steps near the capital and witnessed a Trustee sale? 

Use depreciation on rental properties to reduce taxes further, and consider 1031 exchanges to defer capital gains taxes.