Did you pay off student loans before buying a house?

[Anonymous]

Anonymous wrote:FYI, I am a financial planner. If all else is equal, it is better to have a lower mortgage vs. student loans. The reason is that student loans are not attached to your house and won't force foreclosure if you later have financial difficulty.

Student loans are very easy to defer if you lose a job, get divorced, have medical issues, etc.

So if the tax adjust rate difference isn't signficant, it is much better just to keep the student loan debt.

Interesting! Thank you for the input.

[Anonymous]

No, and though I dont' think we would have paid them off completely, I regret putting the money into a down payment instead of kicking out the higher interest (6-7%) student loans.

[Anonymous]

No. We are a two lawyer household with law school debt for both of us. We've paid off the equivalent of one law school education and a little bit of the next. We made sure that our mortgage payment would still allow us to make extra payments on student loans and we have been chipping away at them.

[Anonymous]

No, because you're going to be paying rent anyway - how much would you save by renting versus buying?

[Anonymous]

Anonymous wrote:FYI, I am a financial planner. If all else is equal, it is better to have a lower mortgage vs. student loans. The reason is that student loans are not attached to your house and won't force foreclosure if you later have financial difficulty.

Student loans are very easy to defer if you lose a job, get divorced, have medical issues, etc.

So if the tax adjust rate difference isn't signficant, it is much better just to keep the student loan debt.

I wish I'd heeded this advice 10 years ago. I didn't pay off student loans before I bought a place, but when I sold it, I did use some of the proceeds to pay off most of my loans. I suppose it was the right decision at the time - allowed a much more comfortable lifestyle at the time, but man, I wish I'd dumped that $40,000 into my down payment. Although my loan is so cheap now, it doesn;t make much of a difference.

[Anonymous]

No. I have had almost 20k in loans for the whole 10 years I have owned my home. I pay extra on my mortgage (at 5+%), but I would never pay a dime extra on my 2.5% loans. It would be foolish.

[Anonymous]

Anonymous wrote:No, because you're going to be paying rent anyway - how much would you save by renting versus buying?

OP here. We have cheap rent. Much cheaper than mortgage will be. And then add all the other costs of home ownership...

[Anonymous]

Nope, still owe 90K and have 15 more years... will pay off sooner if I can

[Anonymous]

I only took out $20K of loans and they are at about 3%. I bought my house before I went back to grad school and took out the loans.

I haven't bothered to pay off the student loans because of the low rate - I've got about $6K left. (loan rate is lower than my mortgage rate.) I do keep my credit card paid off and have no debt other than the student loan and mortgage.

[Anonymous]

Nope, got $100k left in low interest student loans, I pay extra on them but DH and I bought a house when we got married and I'll continue to chip away at my loans.

[Anonymous]

We own two homes plus half of another one we are renovating with partners and still have 9 grand in student loans. They're at 2% so barely an issue. Will have them paid off next year on the 20th anniversary of starting to pay them off.

[Anonymous]

Yes. Paid off $80K of loans at 4.3% my first two years of biglaw. Can't say whether it was the best financial decision but it felt really freeing to get rid of that burden.

[Anonymous]

I did, my husband didn't. By the time we had married (at 30) he had just finished paying the student debt off.

[Anonymous]

No - BUT we added amount owed to student loans as part of our calculation to how much we could afford.

So let's say we could afford a $450k starter home, but had $100k of loans - we told our realtor our max was $350k home. It was our way of making sure we could not only pay our loans but pay them more aggressively as our incomes increased.

We aren't living the high life, but we can afford our house and are chipping away at loans.

[Anonymous]

No. Partner had zero student loan debt, I had prob $15k. I still owe about $7k at a very low interest rate, so no rush there. Glad we bought when we did. I haven't followed the mortgage rates but I assume they're still very low. You want to keep that in mind as you debate waiting.