$300,000 in student loan debt
Hello from Connecticut!
I have a hate-love relationship with Connecticut. I hate the state because it's WICKED expensive to live in. I love this state because it offers over 300+ bird species that migrate through! Yes, I'm an Audobon die-hard, so hello fellow birders and investors.
Here's why I am here at BP:
My wife just got accepted to University of Bridgeport's Medical School!!!!!! Awesome, yes, she's going to be a Naturopathic Doctor, she's following her dream and is blazing a trail as she does it and inspiring other's too. But what about all this student loan debt though? AGH!!
We MUST have a solid financial plan in place now, because in four years ALL of her student loans will kick in 6-months after she gets her N.D. degree. All of her student loans. We're looking at over $300,000. We've deferred her undergraduate and graduate degree loans too. They're gonna kick in and they're gonna kick hard I'm afraid.
So while she is at school, we'll get a living loan at $15,000 2x's a year. That's $30,000. Her current job paid her take-home last year at $32,500. So we will be $2,500 short.
We will need more CASH for the next few years.
We will need A LOT MORE CASH IN FOUR YEARS!
Four-Year Plan:
Buy a Duplex that accepts FHA loan (no more than $200,000) in the New haven County because it's close to her school. Gives us 21 towns to look at. After all expenses, collect the $200 cash flow and put it in our savings account. $200 a month, multiplied by 12 months = $2,400
$2,400 multiplied by 4 years = $9,600
We can use the $9,600 to buy another duplex once she graduates and makes income again.
The goal is to use duplex income to pay off all of her student loans.
Our deal analysis is just like how BP teaches:
Cash flow has to be >$200 a unit after ALL expenses and Cash on Cash return has to be >12%
Expenses
-Principal & Interest
-Property Taxes
-PMI
-Home Insurance
-Water/Sewer
-Garbage
-Vacancy 5%-12%
-Repairs & Maintenance 5%-10%
-Capital Expenditures 5%-1-%
-Management fees 0% (I will manage all of our properties now & moving forward)
We are 3 weeks in on the Duplex search in New Haven we are learning QUICK that cash flow and a FHA loan do NOT get along. Very few duplexes accept FHA and when they do, they're out of our $200,000 budget cap.
We are hungry though, so we are hunting hard! We will find that perfect duplex, I just hope it falls from grace in time before her school starts in August. :)
Thanks all,
Elizabeth