Buy a house or pay off student loans?

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I'm new here so sorry if I post this in the wrong area. I recently inherited property in KY and because I am a Class C inheritor I will have to pay an inheritance tax. I plan on selling the property, and I'm looking at having about $150K in cash after taxes and all of the estate bills are paid and settled. Initially I wanted to take the money and buy a house. My wife and I rent a 3 bedroom apartment for $700 a month, plus about $75+/- for water and $150+/- for electricity. We have a 3 bedroom for us, our 3 month old, and my wife's grandma who provides child care during the day to save money. The dilemma we are both having is whether we should buy a house, or pay off our student loan debt. Together we have about 110K in student loans, which totals to about $700 a month. My loan is fairly low, so if the debt is forgiven after 10 years I will have paid about $18K instead of the $51K that I initially borrowed. I'm unsure on what my wife will have paid after 10 years. Which would be better, buying a house or paying off the loans? I like the idea of buying a house without taking out another loan, so I'm leaning in that direction already.

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  • bexster1975
    bexster1975 Posts: 1,576 Forumite
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    Hi

    I'm guessing you are in the US so am guessing a bit with student loans. In the UK, interest is generally so low on student loans that it doesn't make sense to pay them early if you will need another loan ( e.g. a mortgage). If as you imply the loans are forgiven after ten years and you have been paying whatever they require I would say getting the property mortgage free is by far the better choice. It might be more complex stateside, hopefully someone else will be along to help.

    Either way, very best of luck, sounds like a great opportunity whatever you decide to do.

    Bexster :)
  • andyfromotley
    andyfromotley Posts: 2,038 Forumite
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    try mr money moustache a us based forum.
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    !
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