Refinance Cash Out Question

[Jack Halldin]

Hi All I own two properties in Bonita Springs, Florida. Both were priced a little below market and I paid cash for one and put 40% down on the other, I did some upgrading and have had great tenants from the get go. All good! I confess I did a lot of market study and looked at tons of places but no education in terms of maximizing my cash flow or tax deductions. Just had money and wanted to put it to work. Now I am reading everything I can get my hands on and am looking to cash/out refi my equity from both properties to make additional purchases. In all my reading about various strategies I have not seen it called out that interest on these refi's or cash outs is not deductible. It just seems weird like I am missing something. So if I paid cash of $150,000 and now I want to take $100,000 out of the property the interest on that loan isn't deductible, but if I had put down $50,000 and borrowed $100,000 it would be? Not looking for tax advice I have a note into my accountant and will eventually hear back, just curious if I am missing something or if I just learned an expensive lesson in real estate investing. Thanks and I am loving bigger pockets! Jack