Dave Ramsey has been a mentor and a father figure to me for a few years. He's taught me how to run a better business, be a better Father, and a better leader. Last year I was able to meet the man and get to know him and see how he runs his business and help millions of people every year. His example and servant leadership has given me the passion to teach others to get out of debt and learn to give more of their time and resources to making our world better. His Mission is why I started PRIME RESIDENTIAL. So we could teach others to avoid making costly financial mistakes when buying or selling their home.
1) It is Okay to always have debt-
I grew up in a middle class family and neighborhood. It was the best of times. As a kid, I thought we had it all. There was food in the fridge and the lights were always on. I wasn't ever hungry. I had a charmed life.
My father worked 12 hours a day Monday through Friday and then most Saturdays as well. He was a small business owner. It was how life was. We didn't have everything but life seemed good. We had two cars. We went on a family vacation every year. We had a great home. Each kid had their own room! Life was great!
But we had a mortgage, we had two car payments and we were a few rainy days or an economic downturn away form loosing our home and a small family business. In other words, knowing what I know now, we lived on the Edge. Things were scary.
As I got older and decided to get married, I planned on continuing the middle class legacy taught to me by my parents and everyone else I had watched growing up. I didn't know anything different and life was going to be good for my new family as well. Living on the financial Edge.
Then a few years after having my own family, my father gave me the book THE TOTAL MONEY MAKEOVER.
From then on, things were different for my family. I sat down with my wife and we discussed how we wanted to treat debt in our lives and if we wanted to be normal and have credit card debt, school debt, car debt and a house payment for the rest of our lives just like everyone else. The answer for us both was NO!
It took some time and we worked a plan, and a few years later, debt has now almost been completely removed from our lives. It was hard! We have worked hard together. But we decided together that "Normal" wasn't going to be enough for us. We wanted better. And that is the message we are teaching our kids. No payments! To anyone ever!
Are you interested in getting out of debt? Here are Dave's financial steps to do it!
Follow Dave Ramsey's Baby Steps by clicking here
2) Buying a home with NO Down Payment can be okay-
As the Principal Real Estate Broker at PRIME RESIDENTIAL, I am out in the streets teaching first time home buyers every day. When I sit down with home buyers, the first question I ask is, have you saved any money for a down payment? If the answer is no, I counsel they put off home buying until they have proven to themselves they can save money.
Today, our credit card culture has taught us that we can buy anything now and pay for it later. Even worse, we are now in the "I can buy anything now with nothing invested and hope to pay it later phase." And this is the next generations new normal. Never really paying for anything. Not saving and paying for a home, but financing it along with their school, home, cars and hospital visits.
I like to see my buyers with a 5% down conventional loan.
If they can't get to that, I'll settle with an FHA 3.5% if its necessary (for a variety of reasons.) But I don't love that option like I do the 5% down.
But avoid doing 0% down. It is trouble and I don't want that for anyone I work with.
Want to see what you can qualify for with your down payment?
I have teamed up with a great company at Princeton Mortgage. Follow the link above.
They'll tell you the same thing I will. If you don't have a down payment, don't buy a home.
3) Having a Home Mortgage is normal-
The last myth Dave Ramsey has taught me is that a 30 year mortgage is normal and okay. As a kid growing up, I didn't know that owning your own home free and clear was possible. Maybe a few of those around me didn't have a house payment and I just wasn't aware. But that wasn't the case at my house. It was normal.
Following the baby steps found in Dave Ramsey's program has given my family a focus and a desire to live a debt free life and that includes owing ZERO DOLLARS on our home.
Walking around the grass of your yard and owning every inch of it is a realistic goal for everyone willing to sacrifice and work hard.
As a Realtor, I share this very personal financial message every day with my clients. I took a young engaged couple to Jamba Juice this past Saturday. They were eighteen and nineteen years old. I do this quite a bit. They are definitely not ready to buy a home. But they are asking the right questions already. I am glad they found me and not someone else that would sell them something they shouldn't buy.
They asked questions I didn't ask until I was much older. Had I started as early asking the right questions as they had, I would already be done. So there are young ones out there learning correct principles and making sound financial decisions. I was so impressed! They are few and far between, but that is my ideal client. The ones that want to be smart and save. Those young kids are going to be the ones with the most to give later on. Debt strangles us. It cripples us from being able to really help ourselves and others.
If you have a question about buying a home or if you bought too much house, give me a call. Let's make a plan to help you get out of the debt rat race and on your way to financial peace.
SEARCH HOMES TO BUY IN YOUR AREA WITH A CONVENTIONAL LOAN
Brady Tanner is the Principal Broker at PRIME RESIDENTIAL BROKERS.
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THE PRIME MISSION
We are a boutique Real Estate Brokerage committed to educating our clients how to maximize profits when buying, selling and investing in real estate.
We achieve this accord by serving our clients with the heart of a teacher.
From luxury listings to first time home buyers, we dedicate our time, resources and knowledge, to achieve a very personal an rewarding real estate experience.