Price the marginal dollars instead of arguing about the philosophy. The last $30,000 of that loan has a cost you can compute: at the rates available in this environment call it roughly $200 a month of additional payment, so about $2,400 a year, which is around 8% on the $30,000 you'd be pulling out. That's the hurdle. If the next deal can't clear 8% after every cost and every risk of a rehab that doesn't finish on schedule, the money is better left in the wall.
What that calculation misses is variance. The thin-coverage version doesn't fail on average, it fails in the month the sewer lateral goes at the same time the unit turns. Reserves are the answer to that, and reserves are capital you also can't deploy, so a maximum pull with a proper reserve behind it recovers less usable capital than the headline number suggests. Run the deal with the reserve subtracted and the two options often sit closer together than they look.
On taking less now, there's no permanent penalty. A later cash-out is available if value holds, though you pay closing costs a second time and you re-enter whatever the rate environment is then, which is exactly the uncertainty you were avoiding. Cash-out pricing also usually sits above rate-and-term pricing at the same lender, so a second bite is not a free option.
The risk worth checking in your specific case is the loan's structure rather than its size. Portfolio and commercial-style loans on rentals often carry a balloon or a rate reset at five or seven years, and at that point the lender re-tests LTV and coverage against whatever the appraisal says then. A property that was comfortable at 75% when values were strong can be a refinance problem at reset if values soften. If you're a long-hold owner, the term length matters more to you than the extra $30,000 does.
