Refinance options on VA loan to maximize REI benefits

[Michael Mnatsakanian]

Newbiew investor here.

I used my VA loan to house hack a duplex (purchased in May 2020). I bought the duplex as a VA foreclosure around ~170k, appraised at 186k as-is, and it was previously sold in 2017 for ~225k. Property cashflows great and I want to keep it.

My goal as a REI is to continue to house hack MFH on a yearly basis and to purchase 1-2 OOS rental properties in between.

My question is what do you experienced real estate investors think I should do with my current loan that would be set me up for my future goals? 

I have been quoted 2.25% with $695 origination fee and the rest are fixed costs (VA funding fee, title, credit,..) for a VA IRRRL. That seems like a great way to reduce my rate, but the monthly cashflow would only increase $70 and not sure how this would help with my long term goals.

Another option is to VA cash out refi at 100% (assuming appraisal is at 230k), but then I'll have to continue occupying my duplex for another year and limit my househacking goals.

Final option is to owner occupy conventional refinance (would have to appraisal near 230k for numbers to work) and that would open my full VA entitlement back up and I can purchase a more costly MFH next time. This route has the most up front costs, but I think it gives me the best options for using my VA loan.

Any advice from some of you extremely knowledgeable investors? I might just be over thinking this due to all the options, but I want to best set myself up for my short term and long term goals, but its hard for me do a fair comparison between all the options. Thank you!