Cash out refi for rental property

[Alex U.]

I was wondering if someone could give me the pros and cons from an asset managment and tax perspective regarding doing a cash out refi to purchase a rental condo ( for cash)

Rates on owner occupied properties are about 2.625% 7/1 arm, whereas on a rental they are 3.5%, so by taking cash out of primary I get a much better rate.

My understanding from a tax perspective is that, I can still take the mortgage interest right it off on my primary, which is similar to interest on rented property as it all goes to a persona 1040.