You'll want to incorporate interest costs on the HELOC while you're using it, but that will add to your holding costs in addition to utilities, closing costs, etc..

B borderline A market, is the cost to build worth the risk atm?

-While rent would be more expensive month by month, the idea of being able to take my equity out of my home and also being able to reduce annual repair costs, property taxes, etc. does seem appealing to me. 

If you choose to set it up in Illinois (IL) and then file as a foreign entity in MI, you will end up paying two state filing fees, which unnecessarily increases your costs.

This is the goal because the client wants the majority of the premiums being paid to go to cash value and compound interest over time and NOT go towards the cost of insurance-hence the low DB amount that starts the policy. 

The issue we often run into is the pure cost to build...you have ideas or ways you are working around that?

Most don't understand taxes:  For example, a girl with purple hair at my credit union did not understand depreciation, and I did not get into Cost Seg with her because she really would not understand that. 

Interest rate is 6.3 and cash to close was $23,500.00 due to higher closing costs with DSCR loans.

Worst case, pick up the phone, if it costs you $50-100 for legal advice, wouldnt it be worth it to save potential $1000's. 

We have been doing this constantly in Boise as we are such a high appreication market, but still more cost effective than CA.