Some Assets and so/so credit

[Cesar Lopez]

Hello BP world,

About 2 years ago I bought a single family home in Philadelphia.  I did a lot of things the wrong way, but I feel like all is not lost.  I've been working on getting my credit score back up (roughly mid 600's now), I'm working on getting my credit cards and line down to 0, and have 100% equity in the house (valued at roughly 40k according to zestimate [i know...zestimate isn't to reliable].  My issue is that I want to be able to refinance my house to get some cash out.  I do have a couple of charge off credit cards (part of the mistakes) which I'm afraid might keep me from refinancing.  Here are my questions:

1.) How am i able to refinance with the charge offs and ok credit score?

2.) If I am able to refinance, should I use the money to pay off the charge offs?  or use the money to reinvest into a new property?

Any help is appreciated.