Pay for house in cash, or put 50% down?

[Jason Schmidt]

We are looking into purchasing an investment home for rental income. We have already paid off our home, have 215k in the bank and are looking to get the investment home for 105k. Eventually, we may get 1 or 2 other homes to rent out, but right now, we are just looking at this one. 

What would you do...and why? 

Pay all cash for it, or put 55k down and finance the rest?

If financing, we will probably be hit with about $1,500 more in closing costs apparently, and it will be at a 4% interest rate which equals out to be $16,000+ in interest that we would pay over the life of the 15 year loan.

Several real estate folks have said to only put half down, but we hate debt, and can't stand that a few hundred dollars a month would be going to the bank just for the privilege of borrowing their money. Any people weighing in would be greatly appreciated!

As another side note - this will be for my parents (for now).  They will be paying rent, but not as much as we would normally be getting.