For example, several years from now when rents are up and you refinance to a lower rate suddenly you will have cashflow you were not imagining when you made the purchase. 2.

I would like to look at some HELOC options if possible but I was told I would need to refinance the loan to a conventional investment loan and take on a much higher rate, which I have no plans of doing.

Or they can do it now and refinance later on.I'm not just "telling someone it's a good idea," I actually do this.

I'm talking post-refinance. 

After the home is rehabbed, rented, and producing month-after-month cash flow, the initial lender refinances the home into a fixed-rate, long-term mortgage using his or her great credit, but both remain on the legal title for the property.

Once I refinance to a perm loan, I will then QCD the property to the Trust. 

Chetan,A cash out refinance will not necessarily kill your cash flow or at least not for the long term.

I plan to cash out and refinance after completing the unit, and using the remaining funds to construct additional units.

Build in some equity via rehab and then refinance into a DSCR loan. 

Not to mention the fact that you're going to have SO many more options on the refinance portion if you have that income.