Its unlikely that you'll be able to build 20% - 30% equity with just cosmetic fixes, so your refinance won't allow you to pull all of your money back out.

I had a house under contract that I just pulled out of.

If the current tenant has rented that unit for awhile, they might have an emotional attachment to it so me pulling one behind their back wouldn't be fair to them nor would it make my reputation good in the area. 

Ideally this would have a some type of feed into the MLS to be able to pull down data.  

When I got home, I pulled out a pen and paper to send them a letter.

On the other hand, it could increase unit supply, dropping the rents I could pull in. 

Inquiries can have a negative impact, so you don't want any 'hard pulls' on your credit unless absolutely necessary.

My choice would be to mortgage and pull out every penny possible or sell and start over if they do not cash flow with full leverage.

In addition to being taxed on the distribution you would have to pay the penalties, in some cases depending on the amount and tax bracket I've seen folks lose 40-50% of the amount they pull out.

Let me know if you decide to pull the trigger on us, maybe we can help each other.