Why not just a separate mortgage on the second home?

I just went this. In my situation, conventional mortgage turned out cheaper. HELOC was only good if I planned to pay off the loan really fast (2-3 years).

I don’t know about your state, but mine has a lot of legal protections built into your primary residence (end equity in that residence) that you would waive if taking out a loan against that equity. Not that I plan on any legal issues, but we all experience liability everyday.

Last, interest only loans are REALLY expensive. When I did this, I really questioned if taking out a loan on a second home was really an OK decision when I still had something remaining on my primary mortgage. If you cannot afford to pay principal, maybe it’s not the right time for a second home.