Worth doing a cash out refi if interest rate will be higher?

[Pablo Flores]

I have a vacation rental that I owe $370k on with a 3.75 fixed rate. Home is worth 800k now. I am considering doing a cash out refi with 80% LTV at a 5.25 fixed rate investment loan. This would allow me to pull out $250k and buy another vacation rental. The home would still cash flow very well even after the cash out refi.

What are your guys thoughts on this. Worth taking the extra interest rate to pull that money out?

Thanks

Pablo

[Alex Hunt]

In my professional opinion if the location will still have good cash flow and you are able to capitalize on the appreciation to buy another rental without having to come out of pocket. That would be a no brainer in my eyes, even with the higher rate.