That being said, if doing so, what is the best way to go about it?

So some of the statements made by the OP change the tenor of this discussion.

Investing is so neighborhood specific that a general mentor would only provide basic information that is free on any podcast or social media. 

So we are not in agreement.I sent this to my tax accountant https://www.investopedia.com/terms/p/passiveincome.asp.She sent the IRS link to me https://www.irs.gov/pub/irs-pdf/p925.pdfI wonder how your tax accountant treat your private lending interest?

Derek, so assuming I get a 300K from equity via cash-out refi and I purchase a new property in full cash with no mortgage but with enough monthly cash flow to cover the new loan amount of $494 K ($194K + $300K), wouldn't it be okay to take this consolidated approach with one loan with two cash-flowing properties covering the monthly mortgage and other expenses?

@Addie Burchell So sorry to hear your situation.

I'm a newbie so not trying to be taken advantage of.

In our case the seller needed the loan off their record to purchase a new home so we went through the proper channels to make that happen.

Thank you all for all the information and knowledge you folks share in this platform, found out about bigger pockets through a podcast and I was like whaaaattt, these folks know what they are talking about I can learn here so much.

Every so often one of the older homes in the old city center will come up, and those are always worth a look, but it is pretty rare.Celina also very nice place to live, but probably tougher for investors.