I purchased the property with cash so I have no issue with a lender unless I hope to refinance.

Should I take out a HELOC or a cash out refinance to put money towards my first rental investment down payment? 

A problem is, without good cash flow you reach your DTI limit and can't qualify to refinance your equity out of those appreciated properties. 

I am treating the LOC as an "interest only balloon" paying the interest monthly and planning to make the balloon payment once I am able to get the cash-out refinance, then using the LOC to purchase another property, rinse and repeat. 

Those 2 problems would make it so I'd never be able to finance or refinance. 

How soon could I refinance this and if I did would I always have to replace that $500k equity?

We have looked into hard money, been trying to do a big refinance deal with a couple hard money lenders.We do BRRRRs and having the cash on hand would make aquisition much easier

Should I do a cash out refinance and use some of the equity to buy a fourth property.

The caveat with these loans is it's difficult to break them out of the portfolio so if you don't want to sell them down the line or don't want to refinance one of the portfolio, it's not a bad way to go. 

Purchase price: $165,000 Cash invested: $165,000 Bought cash and doing improvements, hope to refinance and pull off a BRRRR on this one soon.