I don't believe that you can refinance and get cash out with venders financing, I believe that it is only for non veterans such as yourself who purchase homes owned by the VA. Why do you particularly want vendee financing, if you have enough equity then you can cash out up to 80% and continue to not pay mortgage insurance. There aren't any loans available as of now that will allow you to cash out more than 90% LTV right now. And you'll also pay a much higher rate at 90% than you will at 80%.
Have you thought about a home equity line of credit? Try Jason Snell with regions bank!
Hope this helps