All that to be said I don’t think either one is the wrong choice assuming your market doesn’t have capacity limits. 

My understanding of loans and financing is pretty limited.The latter scenario you describe of financing the purchase and rehab and then performing a cash-out refinance is quite frequently practiced.Often, an investor will get a loan for the purchase and rehab of the subject property, and then (after seasoning) cash-out refinance using a traditional bank loan.

I used this in one of our recent properties in the 'kids' bathroom and it looked a little more unique than traditional 3 x 6.

My partner and I have enough for the down payment on a flip, but we’re wondering if we are better off using a HML vs traditional financing. 

This method will likely give you higher cashflow than a traditional rental.

I know the market is really hot in Gonzalez for a traditional rental but was curious about the short term market.

If you don't have the right team on the ground in the other market, you could make a bad buying choice.

We plan to stay here while we transition into traditional flips but will likely sell/rent depending on the market when we find our forever home.

This includes a guaranteed interest rate reduction as well as a guaranteed reduction in the monthly payment.Benefits that set the Refi Now and Refi Possible programs apart from traditional refinance loans include that you:Will get a reduction of at least 0.50 percentage points in your interest rate Will see a reduction of at least $50 in your monthly mortgage payment Will get a maximum $500 lender credit applied towards an appraisal if you don’t qualify for an appraisal waiver (Fannie Mae will provide a $500 credit to the lenders when the loan is sold to the GSE) Won’t have to pay the 0.50 percentage point Adverse Market Fee if your loan balance is $300,000 or lower More from Money:Want to Refinance Your Mortgage This Month?

Therefore, I was happy to have a market where this was seen as less of an issue, and likely allowed me to profit more on this property.Opportunity CostWhere things get interesting, is in regards to opportunity cost.The following are the projections, based on a traditional buy and hold, with a refinance, but without using a HELOC to fund the purchase and repairs.These future returns are what I gave up from selling the property.Assumptions used in the projections / report above are provided below.