Currently I had borrowed 12.5k to consolidate credit card debt and I can borrow up to 23k. 2) Would it be wise to roll this into my home mortgage so I can get the tax break for the interest and allow for more borrowing power from a credit union?

Banks ask for larger down payments to shift risk to the buyer/borrower in default. 

New relationship bank CRE borrowing is especially challenging.

For example, you may build a house that costs $1 million to build, but once it is finished is immediately valued at $1.3 million, so you created 300k in equity out of thin air which you can use to borrow against.

I'm happy to make the connection with one of our borrower's.

Does it make sense to use your HELOC or borrow from your retirement funds to purchase a high risk property?

In many cases the mortgage company writes off the loss or goes after borrower depending on if they have other assets - if they do then they are gonna be coming after the owner

For every $500k borrowed, you’re going to pay $20k/yr more on interest rate alone, plus higher property taxes.

Depending on how much you borrowed, you may need to walk into closing on a DSCR with a fairly large check to pay fees and any shortfall in DSCR loan.  

You can’t borrow tax free against them with a cash out refi.