HELOCs... am I doing this right?

[Rachel N.]

I took out a $50,000 HELOC on my primary residence and am using some of it to purchase a rental, the rest will be cash. My plan was to pay off the HELOC as soon as I can to free it up for other deals. I also have a condo that I own free and clear, which is currently being rented. It's worth about $60,000. My questions: am I using the HELOC correctly? Or should I be refinancing somehow using the condo I own? The HELOC is at a 6.78% variable rate right now and I believe I could pay it off within a year. Also, is it possible to use HELOCs toward down payments and still take out a mortgage on future properties?