@Chris Jensen You should be able to get higher financing amounts, just sent you a PM because I know that there are better programs available for you.  

With a HELOC you are only paying the interest on the amount you use on the HELOC. 

That's definitely a fear, however if you buy right where if you were to move out and it cash flowed a decent amount, then it really shouldn't matter too much.

There, he was talking about what I told him to someone, who turns out to be an investor out there with a large amount of money available. 

If you were to sell a rental house without a 1031 exchange, I *believe* the portion that you have to pay capital gains tax on is the sale price minus the amount owed, right?

If they are mom and pop type tenants, you can usually collect gross rent in an amount a little bit above market rent so that you can pay the taxes and insurance yourself but you are compensated through their gross rent.

If fully rented this may be a 1% property (monthly rents are 1% of the purchase amount). 

I want to see what people would do in real estate with that amount.

Have $100k In my 401k, would it be wise to cash out the entire amount for a rental property?

After down payment, I expect that the amount borrowed will be somewhere between $120,000 and $130,000 with a 2-3 year balloon payment.