It seems possible to extract 40k @ a new 220k mortgage to pay off the credit cards.

They promise they'll pay it, but they run away.I contacted the construction company to understand what was going on and I offered to pay them out of my rental income until we managed to extract the money from the intermediary.

If I could refi at 80% LTV with decent rates it would be a lot easier to extract 100% of my capital using the BRRRR. 

Flipping activity will likely be challenged as ordinary income by the IRS under the theory that flipping is a real estate business rather than a passive investment.As per your question about extracting capital from your properties via mortgages or credit lines, it’s merely a question of cost, i.e., interest rate, points, and other fees, as well as terms.  

That might not technically be correct but when the transfer of property rights is only a partial transfer, it generally too difficult to try to extract what was really going on.  

During that extra week of delay the buyer might:change his mindlose his jobget divorcedget in an accidentdiethe property can get burned down or floodedetc.The risk of losing the deal to any of this is far greater, in my opinion, than any tax benefits you might extract by waiting.

Expressed another way: You're borrowing at 4.375% but "lending" the bank money at 0.4%, the spread between those two %s is basically what the financial sector is extracting from you each year on the sum of money equal to the lesser of the two balances ...

Once you pay off a property then you'll have good cash flow (but no mortgage interest tax deductions), and you'll have significant equity in your home that is difficult to extract. 

There are tons of opportunities for someone to extract value when you're not actively controlling what's going on.

So you do have value-adding options based on the spread between the cost of repairs/updates and the amount of rent increases you’re able to extract.