Cash out refinance tax implications

[Jack B.]

Thinking of cash out refinancing some existing rentals to buy more rentals instead of deploying capital on hand. That said I'm having a hard time finding deals due to low inventory. As I understand it once I cash out refinance the cashed out amount interest wise is not deductible. So can I buy with cash on hand then cash out refinance and just keep the money or does the cash used to buy more rentals have to be the actual dollars from the cash out refinance.

I figured if not required, I would use cash on hand and cash out refinance the rentals later and keep that cash IF I can deduct full interest since I used cash on hand to invest and am replacing it with the cash out refi money. But I doubt that's allowed...Figured I'd ask anyways just to make sure.