This helps avoid issues with lenders when refinancing down the road.

Is this due to a concern that the investor might actually be refinancing and making a NOO into a primary?

I had cash flow left over, and after 18 months, we refinanced and I paid back the HELOC.If you can get into a bigger deal that will create more equity, then it makes sense.

Once you reach greater than 20% equity in the property, it would be a good time to consider refinancing so you could eliminate the mortgage insurance with conventional financing. 

Refinancing?

Wondering if there are DSCR options for 2nd mortgages where can pull out for example just $100k without refinancing the first mortgage?

That generally means buying cash, doing a rehab, and refinancing.

As far as $12,000/year in cash flow if that was your only metric I’d say that makes sense because I have a similarly priced SFH I own in my market that before I refinanced it was cash flowing about $950/month.

They had a track record of completing work, multiple crews, standard materials, and refinancing successfully.

We got a great deal on this property, it's positively cashed flowed over the past few years, we would actually profit on a refinance, and it'll carry an INF% return once refinanced according to the BRRRR calculator.