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Message
Best option with house sale profit
Posted on 2/27/19 at 5:05 am
Posted on 2/27/19 at 5:05 am
May be able to sell my house for around 50-60k profit. Should I use a big chunk of it to pay down credit card debt/loans and buy new house with FHA loan or pay of some debt and put down a larger down payment?
5
Posted on 2/27/19 at 5:12 am to SMACKYtheFROG
Use the money to Pay down debt and rent until you completely pay all your debt. Build a down payment and then buy again.
Homeownership with other debt will limit your wealth building capability.
Homeownership with other debt will limit your wealth building capability.
Posted on 2/27/19 at 6:53 am to SMACKYtheFROG
You should focus on paying off that credit card debt.
Posted on 2/27/19 at 7:00 am to Esquire
All credit card debt should be paid off before considering another house. I would leave some of the other debt possibly depending on interest rate and terms.
Posted on 2/27/19 at 8:09 am to SMACKYtheFROG
Pay down all your debt or the interest on your mortgage will be high
Posted on 2/27/19 at 11:44 am to Upperdecker
Won’t he have to recognize the gain from the home sale as taxable income?
He won’t get the benefit of a like-kind exchange if he uses it for anything other than a home purchase.
However, if you have high interest rates on any debt, this could make sense for you.
He won’t get the benefit of a like-kind exchange if he uses it for anything other than a home purchase.
However, if you have high interest rates on any debt, this could make sense for you.
Posted on 2/28/19 at 2:04 pm to lynxcat
No tax if the proceeds are less than 250k single and 500k married.
Posted on 2/28/19 at 2:04 pm to lynxcat
He didn’t make a large enough profit for it to be taxable assuming it was his primary residence for I think 2 years
Posted on 2/28/19 at 2:21 pm to lynxcat
quote:Tax free as long as he's lived in the house as his primary residence for at least 2 of the previous 5 years.
Won’t he have to recognize the gain from the home sale as taxable income?
OP - payoff all your credit card debt starting with cards that have highest interest rates
Posted on 2/28/19 at 2:32 pm to bodsworth
quote:
No tax if the proceeds are less than 250k single and 500k married.
Very helpful. Interesting provision in the tax code.Posted on 2/28/19 at 5:39 pm to Tiger Prawn
Thanks for the advice!
Posted on 3/3/19 at 10:14 pm to SMACKYtheFROG
We sold our first house when we were early/mid 20's and walked away with a check for 52,000. We asked every aunt, uncle, and parent we have what we should do with the money-
We paid off her car (15K ish), my truck (17K), graduate school student loan (12K ish), home depot credit card (4K), another student loan (3.5k), had a nice dinner, and poof, it was gone.
We were cash flowing well enough (and the interest rates were not terrible) that I wish we had not paid the cars off and instead saved that money (probably would have ended up pissing it away on something dumb) or invested it into a rental property. But... we all know what they say about hindsight...
If you've got some dumb debt, pay that junk off and get a fresh start.
We paid off her car (15K ish), my truck (17K), graduate school student loan (12K ish), home depot credit card (4K), another student loan (3.5k), had a nice dinner, and poof, it was gone.
We were cash flowing well enough (and the interest rates were not terrible) that I wish we had not paid the cars off and instead saved that money (probably would have ended up pissing it away on something dumb) or invested it into a rental property. But... we all know what they say about hindsight...
If you've got some dumb debt, pay that junk off and get a fresh start.
Posted on 3/3/19 at 11:04 pm to Tiger Prawn
quote:
Tax free as long as he's lived in the house as his primary residence for at least 2 of the previous 5 years
And even this can be prorated if you sell earlier than two years.
Posted on 3/4/19 at 5:41 am to SMACKYtheFROG
It sounds like you are planning to buy again. What is the price point you expect to buy at? How much credit card debt and at what interest rate?
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