The Money Coach
  • About
    • Meet Lynnette
    • Media Kit
  • Contact
  • Subscribe
  • Submit an Article
  • Books
  • Categories
  • Coaching
  • Book Lynnette
  • Money Coach University™
No Result
View All Result
The Money Coach
  • About
    • Meet Lynnette
    • Media Kit
  • Contact
  • Subscribe
  • Submit an Article
No Result
View All Result
The Money Coach
No Result
View All Result

Should I Rent Out My Home to Pay Off My Debt?

Lynnette Khalfani-Cox, The Money Coach by Lynnette Khalfani-Cox, The Money Coach
in Real Estate
Reading Time: 2 mins read
rent home to pay debt
9
SHARES
146
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn

Q: I purchased a two-family home after I graduated with the intention of building equity and eventually selling the house so I could pay off my student loans quicker. I always planned to sell my home in about 5 years.

But several people have advised me to hold on to the house for at least the next 20 years so that the mortgage will eventually be paid and I will get the full value of the home when I do sell. Is this a smart thing for someone who pays $600 in student loans every month?

A: I don’t agree with the advice you’ve been given. I think it represents old-time thinking.

Gone are the day when people had to (or wanted to) keep a home forever just for the sake of having a having a home that was owned free and clear. Don’t get me wrong: It’s still great to have a mortgage free property. But in your case, this sounds like a rental and perhaps not your primary residence.

Even if you do live in one part of this two-family home, it sounds like the whole point of why you bought it was to pay off those student loans as quickly as possible. In other words, this property was an investment. Pure and simple. So you shouldn’t get emotionally wrapped up in it and feel like you need to keep it until it’s paid off.

Neither do you need to wait until the 30 year mortgage is paid off in order to get the financial benefits of property ownership. So if your goal is to quickly rid yourself of those student loans, by all means, I would encourage you to look into selling the property.

One caveat applies, however: You said you bought it with the hopes that it would appreciate and then you could sell it. I don’t know how long you’ve owned this home. But if you bought in in the past 2 to 5 years, it’s possible that it may have done the opposite of what you’d hoped — not appreciated, but actually fallen in value.

If this is the case, your equity may have been diminished or wiped out completely, making a sale difficult. Under these circumstances, I would advise you to hold on to the property for a year or two longer – or at least until the real estate market turns around.

Here’s what to do right now. Get a local real estate expert to come see your property and give you a comprehensive market analysis, which will tell how you much you could likely sell the home for in the current market. If the home isn’t “under water” — meaning you own  more on the home than it’s worth — then you can consider selling it.

If all works out, and you reap a chunk of money from your real estate sale, you’d be wise to pay off those student loans, or at a minimum to knock out a huge part of your college debt.

Keep some money from the sale of your home, if you can, just to have some extra cash in the bank. It’s always good to have additional savings, because you never know when unexpected circumstances may arrive that force you to tap into your emergency fund. Also, if something unanticipated happens – such as a job layoff – you’ll have some savings to tide you over, and you won’t wind up in credit card debt.

Previous Post

How Long Does A Negative Item Stay on Your Credit Report?

Next Post

How to Quickly Boost Your 625 Credit Score

Lynnette Khalfani-Cox, The Money Coach

Lynnette Khalfani-Cox, The Money Coach

Lynnette Khalfani-Cox, The Money Coach, is a renowned financial expert, author, speaker, and media personality, empowering people to achieve financial success.

Related Posts

Beautiful home

Refinansiering Med Sikkerhet I Bolig – Refinancing with Security in Homes

by AskTheMoneyCoach UK Edition

Refinancing Your Home There are many reasons to refinance your home, but usually, it is to save a money on your monthly payments. You can also refinance for other reasons, but these are the most common. This can be accomplished by lowering your interest rate or extending the length of...

Text MORTGAGE APPLICATION on Office desk table with keyboard, notepad and analysis chart on a white background.

Two Important Mortgage Terms You Need to Understand

by Lynnette Khalfani-Cox, The Money Coach

Getting a home loan can be a confusing process.  You have to decide whether to get a fixed-rate mortgage or an adjustable-rate loan. You’ll want to shop around and qualify for the best loan rates and terms. And when you’re signing on the dotted line for one of the biggest...

long way road of asphalt with white straight line in the middle and infinite direction and travel distance concept. asphalt and mountains around for traveler and adventure concept. no cars no people long-distance move

Making a Long-Distance Move? Here’s How to Budget and Plan for Success

by AskTheMoneyCoach

Moving can be exciting, but it can also be one of the most stressful experiences you will ever face. This is especially true when you are moving long-distance.  Whether you are moving for a new job, to be closer to family, or simply for a change of scenery, it is...

Sad unhappy black female and male in red t-shirts look at computer, have problems with gadget, service and bills

The True Cost to Get Rid of Your Timeshare

by AskTheMoneyCoach

Owning a timeshare can be a great way to enjoy vacations, but it's not for everyone. If you want to get rid of your timeshare, you may be wondering about the costs involved. From legal fees to transfer fees, there are several expenses to consider. This guide will help you...

African American real estate agent professionally explaining about housing agreement to couple

Negotiating Your Rental Agreement: Tips for Saving Money

by AskTheMoneyCoach

When searching for a new home, you’ve probably come across some great places just slightly out of your budget. If this is the case, and you really want the place, you could try negotiating your rental agreement to get precisely what you want. Many landlords will be open to adjusting...

VA loan. US department of veterans affairs papers.

VA Loans Help Veterans Achieve Their Dream of Homeownership

by AskTheMoneyCoach

For many Americans, the dream of owning a home is a significant aspiration. However, this can be challenging for some individuals, especially those who have served in the military. Fortunately, an exceptional program provides extra assistance to veterans and current active service members in achieving their property-owning dreams. This program...

A perfect neighborhood. Houses in suburb in the north America. Top of a house with nice windows over blue sky. Beautiful Home Exterior. Real Estate Exterior Front House

The Truth About Race and Homeownership – Video

by Lynnette Khalfani-Cox, The Money Coach

https://youtu.be/JjKNdxrKIVwIn this video "The Truth About Race and Homeownership," I discuss the sad truth about race, homeownership, age, and other factors in America. I mention two recent research reports, one from the National Association of Realtors and the other from the Federal Reserve Bank of New York, highlighting the problem. According...

Load More

Popular Posts

  • Car repair

    What to Do If You Can’t Afford a Car Repair Bill

    1529 shares
    Share 612 Tweet 382
  • What to Do if Your Spouse Stole Money From You

    1311 shares
    Share 524 Tweet 328
  • What to Do If You Can’t Afford to Leave Your Spouse

    1276 shares
    Share 510 Tweet 319
  • Here’s Why I Pay My Kids For Good Grades (And Maybe You Should Too)

    1131 shares
    Share 452 Tweet 283
  • What Do All Those Strange Codes In My Credit Report Mean?

    901 shares
    Share 360 Tweet 225
  • Which Credit Report is More Important: Equifax, Experian or TransUnion?

    869 shares
    Share 348 Tweet 217
  • Do This Now If Your Wages Were Not Reported

    855 shares
    Share 342 Tweet 214

Categories

  • Bankruptcy
  • Budgeting
  • Building Wealth
  • Careers
  • Couples and Money
  • Coupons and Deals
  • Covid-19
  • Covid-19 Video
  • Credit Cards
  • Credit Reports
  • Credit Scores
  • Crypto
  • Debt
  • Entrepreneurship
  • Family Finances
  • Featured
  • Identity Theft
  • Insurance
  • Investing
  • Loans
  • Paying for College
  • Personal Finance
  • Press Releases
  • Real Estate
  • Retirement
  • Saving Money
  • Scams
  • Student Loans
  • Taxes
  • Uncategorized

All information on this blog is for educational purposes only. Lynnette Khalfani-Cox, The Money Coach, is not a certified financial planner, registered investment adviser, or attorney. If you need specialty financial, investment or legal advice, please consult the appropriate professional. Advertising Disclosure: This site may accept advertising, affiliate payments or other forms of compensation from companies mentioned in articles. This compensation may impact how and where products and companies appear on this site. AskTheMoneyCoach™ and Lynnette Khalfani-Cox, The Money Coach® are trademarks of TheMoneyCoach.net, LLC.

©2009-2023 TheMoneyCoach.net, LLC. All Rights Reserved.

RSS / Sitemap /Submit an Article / Privacy Policy / LynnetteKhalfaniCox.com

No Result
View All Result
  • Books
  • Categories
  • Contact Lynnette
  • Get Coaching
  • Book Lynnette
  • Money Coach University™
  • Home
  • Subscribe to Newsletter
  • Submit an Article

©2009-2023 TheMoneyCoach.net, LLC. All Rights Reserved.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist