Hello All!
I posted in another part of the blog and had great responses. My wife and I were set on a plan, she gave me another "idea" and now I am a little apprehensive of what is the best choice...
Current Cash on Hand: $23k in our checking. This is after selling our 3rd rental property and paid off a line of credit we had.
Current House Hold Income: $75k + Rental income: $22k
Primary Home:
- Owe: $123k Just appraised 2 weeks ago: $164k
Rental Property #1:
- Owe: $43k Value: $70k-75k
-- Net Profit per month: $530
Rental Property #2:
- Owe: $56k Value: $65k-$70k
-- Net Profit per month: $245
-- Plan to sell this Spring of 2016.
Rental Property #3:
Sold.
2001 Chevy 1500
-- Paid for: worth $3500-$4000
Debts:
-- 2010 Acura TSX: $18,000 balance left on loan ($297 Monthly payment): 3.75% interest rate
-- 57,000 Miles.
-- 2004 Lexus RX: $14,740.30 balance ($370 monthly payment) took out 48 month loan: 4.25% interest rate
-- Hovering just over 100k miles.
-- Credit Cards: $16k total balances
-- Student Loan: $5400
-- Mortgages that are listed above.
Here are the options that her and I have come up with:
Option #1: Pay my wife's Lexus off ($14,740.30) and then sell the Acura to either a dealership and or CarMax and have to pay $3k to get out of the car loan... Drive the paid for truck. Take her monthly payment savings and start crushing the credit card debt. I'd have around $5000 left in the bank if I did this to pay towards the credit cards and I'd not be paying out $370 monthly by paying off her car.
Option #2: Sell the wife's Lexus, she will drive the truck and put $10k towards the loan of the Acura. For her Lexus, if I sell it to a dealership and or CarMax I will need to come up with $3k or private party I may break even. Take the remaining $10-12k left in the bank and pay on credit cards. Take the Lexus payment savings, add it onto the current Acura payment and pay it off within 12 months or less. I'd save her $370 payment and put it towards the Acura payment.
Option #3: Sell both cars... Wife drive's the truck and I will drive the $3500 Civic. If we sold both cars and had to come up with money, we'd spend worst case scenario $8k getting out from under our cars and then also have to buy the civic (or whatever car we decided on). Or I could try to sell both vehicles private party and break even. Then I'd still have the $23k to buy a beater car and pay off the credit cards. Also, I'd be saving the car payments of $667 to invest with and save.
Option #4: Mustache Help ha!
Side Note: My wife doesn't ask for much and she is wanting to become a mother soon. As much as I want to shred the debt hardcore 100% petal to the metal... If I could pay off her car and let her keep it, I know she'd be on board for sacrificing anything else we needed to. I'd really like to pay her car off, let her keep it and crush out debt. She will sacrifice the Lexus and drive a 2001 Chevy that's our "beater" truck but happy wife, happy life. She's willing to do anything, that's why I am hesitant to get rid of her car... We are newly married (Sept. 2014) and we plan to start "trying" for a baby within the next 12-18 months or when we feel we are financially able to enough.