<prompt> Human: I currently live with my family in a rented home. A condo we used to live in is paid off and rented out. Is it cheaper to take a mortgage out on the condo I own or home equity loan or whatever and use that money to buy a new home, or is it cheaper to get a mortgage on a new home the normal way.  <response>: Flip the question around. If your primary residence was paid for, would you borrow against it to buy rental property? If you wouldnt, then sell the condo and buy the new home. If you would, and have the money for a good down payment, then a conventional mortgage would likely be the cheaper option. I would not recommend leveraging the equity in one property to pay for another. 