What should I do with $100k

Question

My house is for sale and I should make around $100k from the sale. I want to start investing in rental properties build portfolio. I have about $28k in debt that needs to be paid off as well. Now here’s the question, should I pay off my debt and rent for a while and purchase one rental property and renovate it? Or purchase primary residence and one move in ready rental property? Open to all suggestions.

Aubrey Maldonado · Answer

@Christopher N. As @Julio Garcia said, it depends on how much the debt is affecting your situation. I have a tendency to want to get rid of debt as much as possible, so my automatic reaction would be to pay the debt off. However, when I think about it more, if you're not paying very much in interest on the debt compared to how much you could be gaining in an investment property it would be better to throw all the money at an investment property.

With interest rates so low on primary residence loans, I think it makes sense to buy a primary residence and keep chipping away at your debt. Especially if you could buy a place to renovate and house hack instead of paying rent. That way, you're killing two birds with one stone (primary residence + investment property).

Christopher N. · Answer

@Julio Garcia buy and hold is my goal. I want to build a rental portfolio.￼

Julio Garcia · Answer

Depends, how bad is that debt weighing you down?

Next what kind of property are you looking to invest? Buy and hold? or a flip? I suggest getting an FHA loan with 3.5 down, and then looking for a flip property to get more $ to invest into a buy a hold property (if that's your goal)