The vast majority of your wealth gain in real estate will be by holding properties long term and the appreciation/principal paydown will slowly but surely help you become wealthy.For 90% plus of people out there who are looking to start, house hacking is the best way to go.

So if the house is worth 300k and you owe 200k then most you could pull out would be 40k (minus costs) and it would be a second mortgage most likely which would be expensive. 7.5-9.5% likely.But, you can put as little as 15% down for a conventional loan on a single family.

With current interest rates (at least in Canada and guessing the US is similar), you'd be further ahead investing that money elsewhere and continuing to let the tenant pay down the mortgage with their rent. 

@Yinon Estikangi Typically if the property has been owned for less than 6 months and the property was recently renovated then we would be fine closing vacant and use the appraisers opinion of market rent to determine DSCR. 

Would you be able to tell us what town it was in?

I got 10X latest commerical auction flyer and there had to be 20 plus hotel/motels.. 

Since you are in an expensive market, commissions will also be high so you should be able to cover all of your expenses with just 1 deal basically, maybe 2. 

Hello BP Community,Excited to be here and to learn from the wealth of knowledge in this group!

If you want to stay in your house, then your only option would be to leverage equity which will probably be in the 8-10% interest rate range.Not knowing the entire situation, I think you could consider downsizing and then using the proceeds to buy a 2-4 unit property and start making $40-75K right away with still no debt. 

I've called a couple title companies there and they are not familiar with the process and one said that the practice CANNOT be done in the state of IL.