4 years left to pay off house - Cash out Refinance or pay it off?

[Kitty Horeis]

Hi,

We are 2 teachers with smaller bank accounts, but with 2 homes in Denver with huge equity. Would like to really start getting into investment properties. We have 4 years left on our old house to pay it off. We should net about $1700+ (depending on taxes, insurance, rental rates) in 4 years when it is all paid out. Do we get a HELOC on our current home, and then use that as the 25% down payments and then use regular mortgages loans for investments properties, so we can get multiple properties over the years? Or do we get a HELOC and just pay in cash for a house because "cash" is better in this competitive market (not Denver, a cheaper area), but then we probably only get one property? Or do we do a cash-out refinance on the house about to be paid off and use that money, but then miss the perks of just getting a bunch of cash each month? Someone recommended that and said it might be good for tax purposes, but it doesn't seem like a good idea to me.

Thoughts? 

Thanks,

Kitty