Student loans???

[Ryan Sajdera]

Hey all! I'm a new investor and I have a question for you. My wife has student loans we are paying on, and with the purchase of our first house, i'm wondering if I should work towards getting out of student loan debt before purchasing another house?? Is it better to tackle all that BEFORE jumping into anymore real estate?? ball park estimate is around 30G for loans @ 400 per/mo. currently. Any thoughts from the professional side of the house?? Thanks!

[Andres Verney]

Congrats on paying loan down.  Good question.

It depends on what type of deals you're investing in, your income and your thoughts about debt (good vs bad). Hopefully your wife's investment in her degree is paying off and it was a good debt that is yielding an ROI.

$400 to me seems like a car payment and very manageable to me.  Leveraging debt at low interest to generate cash flow or large sums of money is good.   

Personally I like focusing on deals that generate cash flow so that they can pay my debts and keep giving me passive monthly income long after the debt is paid off.  At the current rate of $400/mo, it will take you about 6 years to pay off this debt.  How many deals could you do and how much money can you make in 6 years?  Can you get a deal that can yield you more than $400 per month net income?

Hope this helps.

Andres