Gradually scale by researching high-growth markets, partnering with experienced investors, and exploring financing options like SBA loans.

They finally get back to me after the close date to say they need more time because they are try to cross collateralize their other properties to make this deal happen and the bank they were using doesn't do this kind of loan. 

If you pay down $100K in loan saving you $1K in monthly costs against rental income, or you invest that $100K in something that generates $1K in net income the result is similar.

What is the minimum amount of profitability acceptable at a $60 million loan volume4.

That translates into $208 to $375 per month on a $100,000 loan.

I do not have any loans through Flagstar Bank, but I would talk to them prior to moving it into the LLC.

Are you using the 10% down second home occupancy loan?

Another pro for a HELOC is not having to meet a HML's requirements for a loan (insurance, draw schedules etc....)

In addition to conventional loans and FHA loans, if either you or your wife are veterans, the VA also has a rehab program.I'd be happy to discuss my rehab experience both as an investor and as a mortgage broker, and at least help you think through your options. 

@Jake Baker  You should think about a rehab loan if you are going to buy and hold.