Basic Questions About Refinancing... What is it?

[Tyson Lee]

Okay, this is a basic concept that I'm having trouble with. I was listening to a Podcast where Brandon had mentioned a 4 plex he bought for his daughter's college tuition. Below is the example...

-Buy the 4-plex for $200,000 amortized for 15 years

-After the 15 years it's worth $250,000

-If you sell it you will be taxed so instead refinance

-Refinance it at 80% and you would get your $200,000 back as well as still having an income producing 4-plex

This is where I have some questions. 

1.If you refinance does the bank cut you a check for $200,000 and you can spend it on whatever you want?

2.When I was searching Google for answers I also found people who buy a property for cash and then refinance to get the cash out of it. I don't understand how this works... Can someone explain this process in really basic terms. Maybe with some number examples? If you bought a property for $100,000 cash and then refinanced the bank is basically buying it from you (rather giving you a loan for that amount)? 

I'll probably have some more questions from these answers but I appreciate the help with such basic concepts.