Updated over 5 years ago on . Most recent reply
Debt or invest buying my first home
Hello I need some advice. I have 50k in savings. I owe 10,000 for auto loan and 30k for student loans. That's all the debt I have. I want to purchase my first home In February 2021, using an fha loan for my primary residence. I also want to buy an investment property also. Should I pay off my auto loan first, before I purchase my first home, or should I refinance the auto loan for a lower rate to decrease my monthly payments on it? Also Should I only put 3.5% for the down payment for my primary residence and use the rest of my savings for an investment property? Any advice will be greatly appreciated.
Most Popular Reply
#5 All Forums Contributor
- Plymouth, MI
Use your cash to invest in both your primary and an investment property. Then use the cash flow from the investment property to pay off the other debt. When the other debt is paid off, you will still have cash flow coming in from the investment property to pay off other debt, and so on.
If you spend your cash on debt payoff, it's gone forever. If you invest it, it comes back to you for as long as you hold that investment...and, it pays off your debt, current AND future, in the process.