Need help with living/home decision

[Andre Young]

Hello, my name is Andre Young. My fiance and I are selling our house. We bought it for 72000 5 years ago and can get 150000 for it. We have fallen behind on our mortgage and both our cars. My fiance got injured back in September last year and was unable to work until February of this year. During that time she did not receive a paycheck and also I was out in between jobs for a month in March and that is how we fell behind. Between catching up our payments and paying our bills we are having trouble staying afloat. We also Just had a baby in April. We are selling and using the extra to pay off all our debt including our cars (we would just have the normal house bills to pay like electric, water, cable, phone, rent and car insurance) We want to rent to raise our credit scores because they have dropped drastically (like lower 500's). However we also want to get into investment properties. Should we rent a house for us to live in then buy an investment property, do a rent to own for us to live in and do an investment property, or try and buy a house for us and then buy an investment property? We need to do something asap before we can no longer keep up with bills. what do you think would be best and what type of time frame should we wait before buying an investment property? We also have 4 large dogs and getting rid of them is not an option! Once we sell our house we will have no debt. We will have no loan payments no car payments nothing. We will own everything free and clear.I know our credit score should go up when we pay off everything. We live in Virginia in the Hampton Roads area. Just trying to figure out what's the best option, do we rent save our money then get a multi-family home or do we buy a house save our money and then get a multi-family home

[Robert T.]

Andre,

Is there any way you can work out a payment plan with your lender to keep your house?  You already have your foot in the door, even if you have fallen behind.  If your payments are too much based on your current income (not counting the lost work), then I understand why you would be selling but it's hard to imagine a 72k loan being more than your rent would be, even after adding taxes and insurance.

If you do have to sell, then you probably won't like my answer and it probably won't be very popular here. I would suggest renting for now and getting your financial situation back on solid ground before even thinking about investing.  I would also recommend taking one of Dave Ramsey's courses to help you get back on track financially and have a 3-6 month emergency fund set up so that life situations like you just went through won't set you back as far as it did this last time.  Life happens, and real estate investing requires having good financial reserves for when things go bad.

I know my viewpoint isn't popular, but it comes from experience, and learning things I never wanted to learn.