Most people who lose in real estate see it as a road to short-term riches, which it generally is not.

With C class rentals you'll need to run a much higher expense ratio.

For example, you could use hard money to purchase and rehab a distressed property and if your total owed on the hard money loan is still below 75-80% of the ARV of the property you potentially could purchase for no or little money down.

The last question is to organize in ohio or delaware and what we should expect this to run.

If you fix the inside of the house spend a bit of money on the outside. you don't have to break the bank but make an effort.  

Because prop was vacant, I assumed its the furnace, as its the only thing that was running. 

The HELOC is reusable--you can pay it down and run it back up. 

Buying existing plans and tweaking them through an architect could save time and money compared to a fully custom design.

I have two long term rental units now (6 years) and just exited a short term rental last year due to a good off market offer.  

You use $50k of the loan to do the repairs.If you have 20% down + rehab money, then you can do a FNMA HomeStyle program.The FHA 203(k) is a great BRRR tool.