New to bigger pockets. I am 27 and until now was extremely focused on paying off my home. (Following Dave Ramsey’s advice). I now have about $100k in equity. Owe $120k was appraised at $235k. I am in the middle of refinancing to a 2.875 interest rate from 4.5. 

I have caught the bug and was considering taking out some cash to go after investment properties. They are telling me that in Texas, if I want to take cash out, the lowest interest rate I can get is 3.875? Does anyone have experience with this that can help out?

@Tanner Vandevere

Who is “they”? Shop around and get the best rates on a cash out refinance. Never take the word of the first person.

I would not take any capital out of my house unless needed. Saving or borrowing or doing BRRRR via private money is the way to go. Realistically a good option is to sell the house and buy a dup or 4 with the funds and PRESTO!

you are an investor with multiple units!

@Tanner Vandevere At this point, cash out refi is around 3.875 to 4.125% which is always 1% higher than regular home refi. Not just because of COVID, but that's always the case for investment properties. 

Taking cash out from your personal Home and investing to build your rental portfolio is the only way for many to get some quick cash to use for down payment. Even if you have to do HML, you need to pay for closing cost etc., I know many investors who don't want to touch their homestead house to be safe and don't lose it. I would say anything wrong with it but that's also not great strategy to dump all your money in one basket. Your personal home will never be an investment home so putting money to pay off quickly is not great strategy in my point of view. You should rather use the funds to build your asset and diversify whether it's rental or stocks etc.,

@Tanner Vandevere

You can do a regular refi and then look for a heloc on a second position. You will find rates around prime for the heloc with no closing cost.

That’s what I did for my home. I had a 30 years at 4.5% that I just refinanced at 2.75% 30 years and now I am getting a Heloc on the rest of the equity.