Cash out refi or switch to 20-year mortgage?

[Steven Correale]

Looking for some advice. I am currently on a 30 year fixed at 3.625% for a multi-family that is also my primary residence. It was being used as an extended family for the last 4 years, one unit will start renting out at the beginning of 2021.

I am wondering what would be better financially, or if one is more advantageous from a tax perspective once it becomes a rental.

My options are to either do a cash out refinance (~$100k out) on a new 30 year mortgage at ~3% or keep the current balance and refinance to a 20 year mortgage at ~3% and get a new HELOC. Both options come out to the same monthly payment.

I have always payed extra towards my principal and have had the mind set to pay off my mortgage as soon as possible, but now that I will be collecting some rental income, would it be better to leverage?

[Steven Foster Wilson]

@Steven Correale go with the Cash Out Refi. HELOC's can be good, but there is less flexibility and your payments will be higher. Get the cash and move onto the next property. I am currently in the process of Cashing out my second BRRRR here in Columbus OH.