Invest in Real Estate or Pay Off Current Mortgage??
Hello Everyone!
I'm relatively new to real estate investing, currently renovating my residence in the Cincinnati (Oakley) area. I had my plan and strategy all worked out - complete a few value add projects on my home by end of May, refinance, ARV opens up about $90k in equity. My wife and I then move; the current house (SFR) rents easily, $400 monthly cash flow. The equity along with my $100k in personal cash provide means to get stared on my path to financial freedom. I was actively shopping for a 'fixer upper' multi family in one of our local emerging neighborhoods, when out of nowhere, a Dave Ramsey fanatic walks into my life. By the way, I have a full time sales job that consumes most of my time... therefore, I was looking for a place that would require basic lipstick and makeup value adds as opposed to major renovation.
As you'd expect, the Dave Ramsey guy is telling me to pay off the remaining $110k on my 3.75% FHA loan with my cash ASAP. Then sell the house. Use the cash, maybe $215k to by me and my wife's new home, then save fanatically for my first rental. All cash, no debt...
A little background on him - he's been in real estate his whole life, has owned over a hundred properties, got hit hard in 2008 (due to his debts), but still a millionaire, financially free, and of course, debt free. His resume makes it difficult to question his advice!!
I'm 29 yrs old, have a decent nest egg growing in a 401k..... what do I do??
Any advice would be much appreciated!