Refinance or sell to scale?

[Sarah Moncivaiz]

We are at a crossroads. We own a rental that is currently worth 700k. Our 1st mortgage is approximately 130k at 2.75% with a PITI of $2000 and we have a Heloc that is currently about 115k with a minimum payment of $290/mo. The renters are paying $2700/mo. With rates going up, we need to make a decision. Do we cashout refinance and consolidate the existing debt? Do we cash out refinance and squeeze every possible penny out of it to reinvest? Or do we sell it and reinvest.

As of now, we are financially stretched pretty thin. I want to scale up, but I'm having trouble seeing how we can sustain more debt payments. 

Please help me draw back the curtain.