From investopedia: Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment.

@Arthur VoskanyanIn these parts, a home equity loan is generally another term for home equity line of credit, but YMMV.It sounds like you are comparing a fixed term, fixed rate loan - ostensibly secured by a mortgage - to a HELoC.The are two different instruments which serve different purposes ... some of the differences are:Mortgage secured financing:entire amount being withdrawn is advanced at once and repayment is amortized over a specific period (typically 25yrs in Canada, 30yrs in the U.S.A. for residential financing).the term of the loan may be the same as the amortization (common in the U.S.A.), or may be shorter (anywhere from 6-months to 10years in Canada).the interest rate of the loan may be at a fixed for the entire term of the loan or may be variable.there may be limits on prepayment of the loan (without penalty).    

First,  Why would you invest using a tax deferred instrument (REAL ESTATE) inside a tax deferred self directed IRA? 

Investing in debt instruments you’re looking at a top limit on ROI, often with an investment with a finite life.  

@Mark DavidsonYes, a Solo 401(k) can use debt-financing as you suggest, so long as the debt instrument is non-recourse and everything is isolated within the plan envelope. 

The kids should be required to have something like a Texas Instruments Business Analyst calculator and then learn how to use it.There should be general topics on investing in things like stocks, mutual funds, ETFs, and of course real estate. 

Offering a month's leaseback at $1 per day was instrumental in our getting our offer accepted on a fixer last August. 

Quote from @Jerel Ehlert: You should do all the due diligence you would as if you were going to be buying, fixing, flipping the property yourself with your own money - because if the borrower fails and you have to foreclose, this is what you will be doing.Borrower should be paying the fees for appraisal, inspection, title policy for lender, and attorney's fees for drafting.As an attorney, I drafted hundreds of doc sets for closings in Texas and the rest is specifically limited to practices in Texas.In TX, my doc sets include a Warranty Deed with Vendor's Lien, promissory note, deed of trust (the lien instrument), lender's instructions to the title company, attorney letter of non-representation, and either 1) a personal guaranty (if an entity borrower) or 2) a business purpose affidavit (if borrower is/are individual(s)). 

Infact, I'd say if you these houses make up a higher portion of your NW it's more instrumental to protect them.You don't need to layer in trusts, etc.

For me, having middle class W-2 income has been instrumental in acquiring my first rental property a few months ago.