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Debt Discussions about debt and how to deal with debt.

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  #1  
Old 04-19-2016, 02:36 PM
detjason detjason is offline
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Default Pay off Debt by Selling Investment Property

I am trying to figure out if it makes sense to sell my rental property to pay off my debt. Here is my scenario:

-100k in revolving credit debt at about 15% interest rate
-Rental property has about $175k in equity, but it generates $20k net income per year.
-In 3 years, I will have the opportunity to pay off the $100k debt with other assets, should I wait until then?

Thank you for your time.
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Old 04-26-2016, 01:33 PM
Here2help Here2help is offline
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Default Re: Pay off Debt by Selling Investment Property

I think it might help if you give us a little more detail. Is there something else going on that you're looking at getting out from under this debt? I'm assuming that you're making ends meet monthly with excess. If that's the case, do you have enough to cover any shortages from the rental investment? Also what is your goal with the rental and for your financial future?
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Old 05-07-2016, 05:42 PM
usnavy_233 usnavy_233 is offline
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Default Re: Pay off Debt by Selling Investment Property

If you have $175K in equity built up and it's a succesful rental, have you considered doing a cash-out refinance to pull the equity out of the home to pay off debt? Most banks will do 70% LTV on an investment property so if you have $175K in equity, that's a little over $120K that you could pull out.
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Old 05-09-2016, 07:15 PM
Here2help Here2help is offline
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Default Re: Pay off Debt by Selling Investment Property

I just wanted to add to usnavy_233 comments. If you're going to do some sort of debt consolidation using your rental property, just make sure that you're rental numbers still work factoring things like (reserve, vacancy, repairs, insurance, etc).

If you're going to have the windfall of extra money in 3 years, it may make sense to save on the interest. Just make sure that you put the extra money towards where you are borrowing to pay it down.
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