Factoring cash out refi or HELOC into rental property

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I'm looking at two options for tapping into my primary home equity in order to make the down payment for 3-5 rental properties in the next year. I'm looking to make sure I correctly account for this additional debt servicing when shopping for rentals...also looking for opinions on which one of these options is better.

Here are the rundown on numbers:

Estimated home value: $400K

Remaining mortgage: $222K

Current loan: VA @4.5%

Option 1 - Streamline refinance to reduce the rate to 2.5%, bringing my payment down. Then take out a HELOC to fund the investments and factor the HELOC monthly repayment when determining cash flow on potential properties.

Option 2 - Cash out refi at 2.25% for 90% LTV ($360K). Use that to fund new investments. I'm not 100% sure how to properly factor this into my cash flow calculations. The total monthly payment on the loan would only be $100 higher than what I have prior to the cash out refi, but it would be ~$500 higher than what it would be with the streamlined refi + HELOC. I assume the latter is the best thing to use in order to make sure I'm truly cash flow positive here?

Anything I'm missing? I'm leaning towards a HELOC if I can find one with a higher LTV. 75-80% doesn't quite get me to where I want to go for 3-5 properties.

Thanks for the advice!

Your going to be maxed at 80-85% CLTV on the HELOC per traditional guide lines. Problem is you will not be cash fluid you will have a floating open end liability. More than likely have a "Fixed Term" interest only on the HELOC instead of having a 30YR Fixed low rate & one payment -mortgage. Which will provide cash into a interest bearing account that you can use for DP and for seasoned liquid cash for when the lender/bank requires PITI reserves. Also 2.25% on a 90% VA Cash out? You might want to make sure where ever you got that quote from you ask for a 60-90 day Rate lock "LE" loan estimate.

Bank/lender turn times right now are 45-60 days on cash out refinances if someone tells you differently, they must be a private lender.