Also, there are a variety of issues that may preclude the ability to get a HELOC. 

I would not worry if you have the ability to keep rents lower than your competition.

your ability to pull cash and pay down the HELOC will depend on your value of your "investment property," that you're currently buying after you fix it up.If the value is high enough you'll be about to get out a new cash out loan that is high enough to refinance your current outstanding debt plus provide sufficient proceeds to pay down or off the HELOC so that way you can rinse and reuse it again on a new property.As long as you gauged value correctly on the buy side of the investment property you should be fine.As for how DTI is calculated on the HELOC, it depends on who you go to for a loan but typically we'd take the current min monthly interest payment on your current monthly obligation.Some banks had higher hypothetical payment models (assume 1% min monthly payment on the limit of your HELOC) which threw your DTI off, just try to avoid banks like this...

You have plenty of folks on BP to help you as you grow your portfolio - this is a great resource for you to lean on and any of us will be happy to provide some insight, inspiration and motivation if you need it.....Be remarkable,Richard :)

You're being sold a bill of goods.  

It is not necessary depending on your ability level.

What we are looking for:-80% LTV on refinance w/ cash out if needed-5-6% Interest rate-15-30 year fixed no balloon-Ability to do Multifamily and single family

My first reaction is that trying to bill separately for sewer could turn into a billing (and potentially legal) headache.  

I know a few bigger players were this is working but they are working with hedge fund type money 5 to 20 million.. and have the powder and ability to scout the VERY best deals.. most folks simply can't do that .. if they are starting out.

Why advise a newbie to put something under contract that they have no ability or intent to close on?