Debt Pay Down vs. Save Cash Flow for more Property
Hey Everyone,
I'm having an internal debate and would love some feedback on which strategy is better.
I own one duplex.
Option 1: Do I take all of my excess cash flow (which I don't need) and pay down the debt as fast as possible - with the intention of refinancing, using the proceeds to purchase other income properties.
Option 2: Save all of my cash flow to combine with my other savings to fund another down payment and just do this as quickly as possible (while still keeping a reserve for disaster etc..)
More than happy to answer follow-up questions but thank you for any insight, experience, or comments on comparing these strategies.
Jon
Most Popular Reply
#5 All Forums Contributor
- Plymouth, MI
So you're asking if you should:
Option 1: Slowly put your cash (excess CF) back into a property, which becomes dead money (equity) so you can pay to use it in the future (refi)?
or
Option 2: Collect it with other excess CF, and spend it to reduce the cost (increase CF) of the leveraged money on a future property?