Cash flow positive until....primary residence home equity loan

[Travis Hibbard]

Good afternoon everyone!

I'm in the process of searching for my first deal on a duplex and trying to determine financing options.  I have plenty of equity built up in my primary residence and was planning on using that as a down payment.  When that 2nd loan payment is calculated into my monthly cash flow it goes from a modest $350 to negative.  

Am i missing something?  Are folks using this approach and waiting for a refinance to pay off the 2nd mortgage? Debt snowballing the 2nd mortgage asap to get it paid off?  I also was considering selling some of my after tax investments but then I would need to pay capital gains on that money.

I searched around the forum and could only find posts targeted at heloc vs. home equity loan so if i missed it and someone has a link I would appreciate it!

Thank you in advance for your advice!