Refi/Cash Out Question

[Matthew Lessard]

Hi All,

I am looking to refi and cash out on an investment property. It has built equity over the years and I would like to use the cash to purchase another rental property. My mortgage broker informed me that since I am refinancing/cashing out on a rental property my interest rate will be higher (about 1%) compared to if I actually lived in the home. 

Is this correct? If so, it may not make sense to cash out if the monthly mortgage payment on my current rental will increase due to the higher interested rate. Is there any way around this?

As always any input is much appreciated.

Thanks!