The rental home already rents for $1250 and again I have no mortgage.

You will also always have the option of doing a rate and term refinance in the future to refi both the first mortgage and HELOC into one loan. 

The lender didn't go out of business, YOU are choosing to follow your mortgage guy to a new lender.

My gross monthly average since November is about $3k per month, and my net outside of my mortgage is about $2k per month.

Generally, the only closing costs you can deduct on your taxes are those related to mortgage interest, purchasing points, or property taxes.

(And no, he isn't supplying his own paint, I already ran that by him just to make sure that wasn't his methodology).By the way, he mentioned the "new" CSLB  limit is $600/materials+labor but when asked for a reference to that, did not furnish anything and I can't find any info online as to that.

The most obvious is that you will be able to offset your mortgage with renting out a few rooms.

I've spoken with a few mortgage lenders about FHA and conventional loans.

I would like your opinion on whether it would be better than finance the whole purchase with a HELOC from my primary residence or only get the down payment from there and get a traditional mortgage for the rest. 

.: Subject To and Wraps are very similar and yet, very different.Subject To & Wraps share these characteristics You are taking over payment of the mortgage and transferring the property into your name You become the owner The loan does not get paid off The lender can and sometimes will call the Due on Sale You have to have money or credit to solve a Due on Sale call They are used when someone doesn’t have much equity and doesn’t want to pay a real estate agent They are used when the seller wants to sell fast They are used when the property isn’t really a good candidate for the MLS because of the condition of the property They are used when It’s a unique property and it’s hard to find comps They are used when it’s a distressed situation that needs to be resolved They are used when the monthly payment is below market rate (that means it cash flows) They are used when the seller wants to avoid the hassles of listingSubject To & Wraps Differences In a Subject To, NO new mortgage is created.