@Sawyer Kelly Ok new question, most people who are going with seller financing don't have $40k for down payments, so would you be accepting worse terms than if it was a bank loan, if not and the terms would be equal to or better than a bank loan has your friend done the math on just biting the tax bullet. 

Do your homework and make sure the numbers work.

I'm in my mid 30s with a wife and five kids aged 8-13 (don't bother with the math, some stepkids some biological in the mix, love them all...haha).

Again, a lot of this is napkin math, but I couldnt see giving up a gold mine like that. 

As long as you do your math right I don't see any problem with it.

The reason for a conventional mortgage instead of a HELOC is (1) not as many lenders offer HELOCs on rental properties, and (2) the interest rate on the conventional mortgage will be lower.Here's an oldie but goodie on BP on calculating income:https://www.biggerpockets.com/blog/2013-01-19-real-estate-math

But that cash out would serve as down payment for another investment property where I can cash flow at least $200 (hopefully more).In my head the math tells me this move makes sense but I don't know if there may be other numbers that I'm not taking into consideration.Would you consider this a good plan?

Their analytics are way off base for market and rent values in our area so you really need to do your homework before bidding.

Do your math on how much that is going to cost you, and then use the calculators to consider a long term loan.

If you rush into it without doing your homework you may end up in difficulty.