The house is located in both a historic district (Mills Act) as well as an opportunity zone allowing for large property tax rebates and the elimination of capital gains tax when we sell.

The house is located in both a historic district (Mills Act) as well as an opportunity zone allowing for large property tax rebates and the elimination of capital gains tax when we sell.

Need to look at your debt to income ration so get a broker that gets this.

Here's my situation: House 1: 250k in equity (1 mortgage already on property, primary residence) House 2: 285k in equity (1 mortgage already on property)I don't think my debt to income would allow for another property.

Ways I’ve thought of is assume their debt and allow them to take a second out in their name to take the remaining balance.

So if you want to eliminate the risk you need to increase the cost and pay a contractor that can run the business.

Essentially, eliminate the long term financing piece and just do HELOC...at least for a little while. 

I'd focus more on cash flow, potential appreciation, debt retirement, tax advantages, and your return on investment. 

Because you are just starting out, some banks may not consider your rental income in your Debt To Income ratio so you may already be temporarily capped out.

If you have 20-25 % down and good credit you should be able to do a debt service ratio loan.