Rental Property Financing - Chicago

[Nicholas Sanchez]

Hi everyone!

I own and live in a condo in Chicago (Old Town area) that I purchased for about $600K and currently have about $250K equity in the home. I am looking into purchasing a rental property in the Chicago area and was trying to figure out what everyone thinks is a better idea:

1. Since I have limited cash available, purchase a property worth around $100K and finance with a conventional mortgage (20-25% down).

2. Use a HEIL or HELOC to purchase the property, in which case I could increase my price range. I am not too familiar with the HEIL/HELOC financing yet, but not sure if I should be nervous to do this!

Bonus Q: Any recommendations on solid areas in Chicago area to invest in rental properties?

Thank you!

Nick