What is your risk tolerance.

It's more about your risk tolerance, marketing savvy, and management of the property that will make it work or not. 

In regards to the HELOC question- that ultimately comes down to your personal risk tolerance.

Bigger Pockets does a good job of having members with a low tolerance for fraudulent behavior, who will tell you what they think.

We have a large amount of "Snowbirds", people looking to escape our miserable winters in a much more tolerable climate (think Florida,Arizona etc) and when I tell these people that they can stay in a beautiful condo for literally a quarter of the price they would pay in many of our cities they jump on the opportunity.

It all depends on your goals and tolerence of risk and income taxes.I started out just like you with putting properties in my own name.

Much depends on your strategy, your risk tolerance & timelines, how active or passive you'll be in the investment......Read the forums, develop your own strategyIs Illinois a good place to buy? 

Are there banks which are more tolerant to less owner occupied units?

Since you cannot do conventional financing and HML are beyond your risk tolerance, I would recommend that you adjust your timeline and use an FHA loan.  

Without knowing your risk tolerance or your market, that's a massive variation!