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Pay off debt + 1031 exchange?
Hi, we have a property we have held for nearly 4 years. It cashflows and has appreciated in value since we purchased. With the profits, we are looking to sell it to pay off debt, get us out of the rat race, and pick up another rental property (we would have the next property nearly paid off).
My question is: Can I use part of the profits to pay off consumer debt (credit cards and student loan) and 1031 exchange the rest into my next property? Is there a better strategy for accomplishing what I am trying to do? (Such as maybe 1031 exchange all the profit, purchase the next rental and pull equity out with a HELOC to pay off consumer debt).
Strategy #2 makes the most sense to me... still just trying to wrap my head around it. Any ideas welcome. Thanks!