I would only do it if it was an absolute no brainer of a deal as if it goes south then you not only hurt yourself on that deal but also the property that you took the heloc out of.This also depends as if your current LTV is 30% and want to go to 50% is different than going from 50% to 80%.

Now if it was definitely a single unit and only she could do it and it was properly labled it would be on her.

As long as you're doing that, there's always a risk, and 50 years from now it will probably be illegal everywhere to operate STRs in residential zoning, just like it's illegal to operate a steel mill there. 

@Bryan Hartlen thanks for sharing more info.Agree that it shouldn't take this long to do MoveOut Evaluation!

There's a specific forum for House Hacking.You'll want to spend some time reading through there as it's a common topic.

This is what I do with my rentals and it is great!

Did you ever find a solution for a 3rd position heloc?

We have done it both ways where we fund purchase and they cover rehab but if the individual is less experienced we do not do it that way, we have them put more money into the deal from the start and fund the draws, reason why is we also had a deal where the person said they would do this and never did anything and property sat and loan matured and it was a pain.Just recognize you will still not get 100% financing for the purchase, so you are putting money in up front. 

I’ve never ripped anyone off, in fact if I forgot to do something I’ll end up having a dream about it and go back and do it.

There are ways you could do this, but it sounds like you've already resigned yourself to the loss so I won't bother.