Looking for advice on buying a new house and renting my current

[Trey R.]

Looking for some suggestions on how I can best utilize my money in this situation.

Current House: Appraised at $141,000 in October of 2014 (Purchased for $122,000 in 2010) - Currently owe approximately $98,000 on the mortgage which is a 5/1 ARM. (It was refinanced last year to the ARM because I was going to pay it off in less than five years).

We are going to be purchasing a new house in the next month or so (baby on the way).

Price: Approx $200k (3.5% for 30 years using an FHA loan with a 3.5% down payment).

I have approx $22,000 in savings.

I'm planning on refinancing the current house after the new house is purchased.  I'm going to do a 30 year loan on it so that the payment is lower in preparation of having renters.  I would like for the payment to be low so that if I go any time without a renter than I won't be paying a bunch of money.

At this point I am just going to do the 3.5% down payment and be done with it.  Is there any reason why I should spend more money now and pay myself back by doing a cash out refinance on the current home I own after I close on the new one?  Ideally I would like to get the best deal without having to spend any of my own money.

I still have a good amount of research to do before renting the house out but I wanted to try and make the best financial decisions in purchasing the new house and refinancing the old one.