We are in a strong sellers market and inventory is always tough to find.Of course off-market opportunities are usually still plentiful via good wholesalers and other investors.With that said, everything mentioned is all good advice.Who is your local property manager?  

Should I go with a Heloc, a home equity loan or since my DTI is low, go the conventional route?

I am OK leaving a little in the project, but not all of it.Since I am currently using conventional residential mortgages (I have less than 10 mortgages), the underwriting is following Fannie/Freddie Mac guidelines.  

Conventional, FHA, VA, USDA, MA housing.

I'm out shopping on the conventional side now.

Would I be correct to think that we could use a HELOC to fund the down payment and use a conventional mortgage for the rest?  

A POF from a convential lender means you have passed the lender's credit and income criteria, and if the property appraises high enough, with no title issues, financing will be available.Since hard money lenders place much more emphasis on the property securing the loan, the POF letter ranges from significantly less reliable as compared to a letter from a conventional lender, to outright worthless (some hard money lenders provide a form and you fill in the blanks, i.e. no real approval).

I have 2 mortgages both of with are conventional (20% down)thanks,

On conventional loans, they can't even charge a prepayment penalty for it!

Inventory in this area is getting increasing more scarce.