Pay debt off before acquiring a mortgage ?????

9 Replies

I considered the same thing initially but if you can get qualified on Real estate that is going to cash flow after all expenses then you can pay debt down faster with cash flow and still making money off appreciation and loan pay down. If the numbers make sense, go for it. 

It really depends on the debt. If it's expensive debt like credit cards, I'd work on paying that off before jumping into this crazy market. If deals were plentiful, it would probably be better to start now. 
Warren Buffet has a quote: "We always look to be greedy when others are fearful, and fearful when others are greedy." Obviously he's referring to stocks, but the lesson is there. If you find a can't-miss deal though, always pounce! 

Originally posted by @Ali Khweiss :

@Joe Villeneuve only because I feel like taking on a mortgage will be my ultimate biggest debt so why not eliminate any current debt I have now!

 Once you spend you cash on your debt, that money is gone.  When you use it to invest with, you can use the cash flow from the investment to pay off your personal debt.  After your debt is paid off, that cash flow keeps coming.  Without the investment income coming in, the source of funds to pay your debt is you.  With an investment property, that source of funds is the property...which keeps paying you, over and over...including paying you back for the funds you used as the DP on that property.