It's time for a big a q a a the b a q a What you say the big a q a man?
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If you were on youtubel now you.
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So this pot this episode, we are going to focus largely on money questions and yeah, are they real estate questions? Are they both kind of like real estate?
These are real estate questions?
Yeah?
You got some juicy one who I feel like I'm in the exact same situation as so a listener who's wondering whether she should buy in this market right now and sell her home. And then another really tough one from a listener who did the right you know, did the thing everyone's iging and talking about buying rental properties and then getting into a lot of debt in the process and trying to figure out, Oh shoot, I'm in over my head. So we got some juicy ones for
all today. Where should we start to if you want to start with strange?
Yes, Holange, Solange.
I love that. All right, Solange, here's your question. Hi, Mandy and Tiffany. I'm a loyal weekly listener. Thank you to your podcast, and I'm learning so much. I'm in a dilemma about the best course of action to take concerning whether I should sell and buy in this crazy housing market. We own a townhouse, have about twelve years left on a mortgage with a two point three interest rate. Put that interest rate in a museum because it is a fossil, okay, from another era. We want to move
and purchase. We want to move and purchase a home in a better school district, want a single family. Even though we stand to make a good profit on the sale, we will also end up paying more because of new house prices and high interest rates. What should we do? Please help? Much appreciated, Thank you. I loved your first question when you read this. What was it?
What did I say? I said?
You said, how about is that school? How bad is it?
Because I'm like, at three point two percent at two point three, not even three point two because three point two would be insane.
Two point three? Is they done? Gave you that house for free? Girl? Like, well, there's a few things.
And when I was being facetious, but not because you know, schooling, are the kids really little? You know? Because there's a lot of supplemental things you can do if you've got like, you know, a one year old, two year old, three year, four year old, even up to like you know, second or third grade. Like there's so many not to say, you can't do that if you have high school kids.
But I feel like, you.
Know, like a high school is in the school district is more like I don't know, it plays a pivotal role.
College prep, yeah, you know what I mean.
So like, but if your kids were really young, I might be like, girl, you know, like you know, do that and then you could also get like tutoring and all that kind of stuff, you know, because you know, financially, you know, the cost of buying another house is really going to not only is it going to affect your monthly expenses, you know, although you might be in a better school district, it might affect your ability to do things for the kids.
Right, So like here, maybe you can afford soccer and tennis and this and.
This other places like whatever the school provides job because we can't afford anything outside of that.
So consider that, you.
Know what I was thinking, I was thinking, I wonder what the mortgage is and if you were considering do you have to sell the house is it possible to rent out the townhouse for more than what your mortgage is because the interest rate is so low and that use that to supplement and help pay for your new
mortgage if you were going to move. That's a potential if your monthly payments are not like let's just say like a friend of mine bought a house years ago for one hundred and eighty thousand dollars, and I forget, his interest rate was super low, and he was paying like, I don't know, like eleven hundred no, not even I think his I think his mortgage was like eight hundred bucks a month something ridiculous. And we talked about that, and I said, you know, consider renting it out because
that place would rent out easily for two thousand. It was like four bedrooms, three baths easily rents out for two thousand, and because he wanted to be in and he wanted to be in an apartment because he was traveling so much. And I'm like, and then that additional twelve hundred bucks a month can be put toward whatever your rent's going to be in your new apartment. So
consider that as a as a possibility. What do you think what choice are you thinking about, like, what are you thinking about, Mandy when it comes to First of all, Many's house is so cute.
It's like such a.
Nice and cute exactly, It's cute, it's pocket size, it's adorable.
I loved it as I like, I mean, I really really went home shopping, you know, from a New York City apartment perspective of like, oh, look we have a yard and there's a deck, and there's you know, three bedrooms and two and a half thousand you know, it felt really big at the time, but a kid and a half in, you know, this house is going to be it's going to be tight, right, And we have thought about, you know, what could our next move be, but we're stuck, Like we have a similar we have
like a two point something interest right too, and we refinanced, which this sounds like she probably did as well because they only have fifteen twelve years left, so I'm assuming they. Yeah, so we refined in twenty twenty one as well when rates were really low, and I'm so glad that we did. But yeah, now if honestly, the only way that I can see it working for us is if we leave New York or we move like maybe to Georgia or
another low cost you know, suburb of New York. But to find a comparable to find a home in a good school district where we live now, we got our home for four hundred and forty five k. I mean we probably need to pay over a million dollars to get to get yeah, to get just a decent you know, maybe a five bedroom, four bedroom, you know, with an office for me, like to get that level of home. Yeah, it is not cheap out here. And it's because of taxes on top of that. It's like the taxes, yo, taxas.
Because one are the taxes because like so I'll give you an example. In new my house now, it is twenty don't nasmia woman, Texas, twenty two hundred square feet. It's four bedrooms, yeah, three and a half bath, it's three floors. And I want to say, my taxes are like ten thousand dollars lately year they just they just went up at your house.
Yeah, I feel like ours are fourteen or fifteen okay right now, and we have a teeny house. It's like sixteen hundred square feet. It's not anything crazy, and we do live in a decent school district. I remember, everyone's like, oh, the schools are so great, They're fine. I don't know. I'm not like wowed by any of the statistics I read. But yeah, the taxes are nuts. And I mean, our interest rate is so good right now, I'm just checking
mortgage rates. As of today's taping in mid April, we're at seven percent for a thirty four thirty year fixed I mean, that is like to quantify that I wish I And that's what the seven hundred at score, you know, So I'm let me upgrade this. Let's see, husband and I probably have like mid seven hundreds to high seven hundreds. We can maybe get like six point six five percent, but that's still triple. I mean, that adds tens of
thousands of dollars to the cost of your loan. And because of the way mortgages work, they're going to frontload all that crap onto your interest. I mean, you're you know they're going to do what's it called again? Well, shit, what's it called? That word that I've always was confused about, which basically means that most of your first payments will go toward your interest, not you're barely even touching your print there when we have a mortgage, Yeah, barely. So
that's where we're at. So I'm we are writing it out like I'm not trying to make any hasty decisions, and so Jasmine, I are sorry, Solange. I would say, you know, continue thinking and continue looking. Maybe you'll find a good deal. We've thought about maybe purchasing land, you know, and building instead. But it's when I hop on you know, any real estate listing sites and look to see what's that out there, I'm just like, and this house is actually great. Why are we even trying to, you know,
think bigger? This is perfect? You know, we can all have that. I'll put my basement in the crawl space. I mean, I'll put my office in the crawl space if we need to. It'll be fun. I'll get some lighting, i can record the show laying down. It'll be cute. It'll because like whatever, Yeah, this is one of those times.
We're literally the financial component has to be like and so you got to do that math because it could literally go from you know, you being able to like afford your life and literally not for more space and.
Like you know, and that's the thing. Yeah, yeah, because I feel like we're doing fine. Now I don't feel like we're paying you know, because now an entrepreneur and you know, the money is different now like I don't.
I don't.
I could not afford a million dollar home right now. I know that for sure. Like to double what we're paying right now, I would. It would create the kind of work life that I'm trying to run away from, which is like you know, working around the clock, which I am. I don't want to be over mortgage at all.
It would just be so stressful and honestly, I know, like because I mean I share this before, you know, I bought the condor. I finally the people move out this month this week, woo, because I leased it back to them for like the carrying costs it was just about two thousand dollars a month. So they paid me four thousand dollars to stay in my place. Hey, thanks, So I get the keys by the time you guys listen, I'll have seen it. The day before I get the
keys covers the taping. It's a Monday. I get the keys on Thursday, and I do a walk through and this show comes out Friday. So I remember when I was buying it. I bought the house for I want to say five twenty five twenty, I mean minus. I guess you could say five sixteen, because you know they
have to pay me that money. But you know, like on the books five twenty, and I remember my financial advisor, you know, Angelie shout out to her telling me that ideally to get a mortgage, which I can understand, because you know, you want to put that money in the market, because you know, half a million dollars can do a lot in the market. But I already put a lot of money into the market every year. I live off
of less than ten percent of what I make. And I just didn't want because right now I don't have a mortgage at the house that I live in. Now I'm not selling it. My sister and her kids are going to live here. I don't have a mortgage here. It's just the carrying cost, which is like I don't know,
eleven hundred bucks a month. That's taxes as well as like PSNG and all my utilities and all the kinds of Like eleven hundred bucks a month is what have cost, you know, And I'm like, so to go from eleven hundred bucks a month to the carrying cost of my new place is about two thousand if you just include the HOA fee because it is a condo and which is about twelve hundred, and then taxes, which is about like another eight hundred bucks a month, So two thousand
dollars a month. On top of that, if I would have included a mortgage, let's just say my mortgage is going to cost me another twenty five hundred, you know, almost to go from eleven hundred to five thousand dollars a month. Not that I can't ford it, but I'm not gonna lie. The way might be my post dramatic, you know, post traumatic broke SYNDROMEA set up my STUFFA couldn't take it.
I was like, you know, so I didn't.
Want to have, like to pay five to six thousand dollars a month after paying a thousand, basically because my sister's gonna take over the carrying cost here, so I'm not gonna have to pay that for this house, you know. So I didn't want to go from a thousand to like five six thousand. I just feel nervous about it.
And so I made a decision.
Although it was not a probably the best quote unquote financial decision, it was the best financial decision for me and how I needed to navigate because the truth is, yes, five hundred thousand in the market kuid yield a ton. I already have money, and I'm still wearing my target's best. I'm not you know, I don't carry any debt. I have no debt, no credit card debt, so I'm not
in any sort of financial struggle. I paid off my parents' house, I paid off my student loans, so it just met the difference between money or more money, and I was like, I'd rather the security in my stomach versus additional money
that I'm not going to spend anyway, you know. So I'm just sharing that that like when you're making decisions, you know, sometimes you get to make a decision from a place of just emotionally, this is where I need to be, And sometimes you have to really look at the bottom line and say, the math is not mathing in a way that will allow us to sustain a healthy and healthy, healthy and happy lifestyle. So this seems like a real math math lean in versus like an
emotional leaning. So Solange, you know, look at the math and ask yourself, would we be able to like sustain a decent life, you know, with all the additional expenses.
Should we move or do we.
Make it work where we are and just bide our time and keep our eyes and ears open for something that might fit better later on down the line.
Good luck. Let me know what y'all decide, okay, because I need your advice to Also, I've like thought about with renting out our house, keeping the house because I feel like I don't want to get rid of this mortgage. I mean the good rate, right, but like should I keep the house and then rent it out would somehow make a situation where I don't know, I don't think so, I don't I don't know.
You could write the good thing about when you have rental property that they will count I think like sixty percent of it towards your income.
So for you to afford more of a house, you know.
Yeah, that's the thing. But it's again, it's like you know, you know again, like positioning us to just be like really over in an expensive home.
You know.
So I just told Husban like I have no doubt we'll get there, you know what I mean. Like I'm doing fine. I co host Brown Ambition. I'm an ambitious lady like, we gon't be fine, but we ain't there yet. So I am very comfortable being like, we're not there yet. I won't even let Hi get a second car. He's so so salty about that. I'm just like, you're you're having a second baby, so we're not getting a second car. And Helen backs me up, went in doubt, get a
financial planner to bring you down to earth. Actually that's a good tip. Financial planner can really bring you down to earth because when her husband and I have a disagreement on a big purchase, the second car being one, Helen makes it very clear here's what you would have to give up. I don't think that's a good idea. And I'm like, Helen said it.
Not me, you know.
But thank you so much to launch for your question. All Right, we're gonna take a quick break and be right back with an even juicy or a real estate question. So stay tuned, be a fan. We're putting a lot on our shoulders today. Okay, this is stressful. All right, see y'all back in a minute. All right, we are back back, and Brown Tiffany would like to do the honors of reading this. You want me to read it because I feel like I'm gonna read it and immediately just like give it to you to answer.
No, go ahead to read it because it's stressful. My LA was like, wait. The more I read it, I was like, I'm gonna try Okay, okay, but.
This is the reality, okay, and I'm not gonna lie. We've been getting more and more questions of people struggling with debts. I'm just like, I feel like brown ambition Q and A is almost like an indicator for the economy and where we're heading. So I think it's good that y'all are getting it out, releasing the debt demons and trying to figure out what to do. But this situation in particular is pretty complex. So this come from listener who would like to be called j. J. Says.
I am forty years old. I'm a senior accountant. I make eighty three k a year. In twenty twenty one, I got out of a long financially abusive relationship and I sold my home and I got a huge lump sum of money. At the time, I had no debts other than student loans, so I spent the money purchasing
two homes. Home A was a new construction around four hundred K, and Home B was a twenty year old fixer upper and I put six hundred K or sorry, I put sixty K into renovations, and I also got one hundred and twenty K loan to add a pool. As soon as I moved in Home B, everything that could go wrong happened. My main water lane, my main water line backed up and flooded. The first floor. Oh lord, master bath had to be ripped out three times and
is still unfinished. The pool is half that's done because I ran out of money and the AC unit completely died. At this point, I had depleted my savings. I've run up over three hundred thousand dollars in loans and credit card debt. Right now, I'm assuming this is monthly right. My monthly take home pay is five K. My monthly expenses are fourteen K. With the houses, I am living bare bones and renting out Home A until I sell
it this summer. Home B mortgage and bills have not been paid, and I am one month behind on all bills. I have two people renting out my spare rooms. I can't sell Home B without finishing the master bath and the pool, which is going to be about twenty eight k combined, and investors want less than I owe. I have been in therapy and trying to understand my spending and why I spentous frivolously. My question is how do I stop the bleeding. I have cut all other expenses.
My vehicle is paid for. I have two children's aged two children ages two and three that I am able to provide for. I can't get assistance because I make too much. Do you suggest one on one coaching or one of your courses. I look forward to your response. Jay.
I just want to do breath because this is rightfully so very stressful, like it is, yes, you know, so you know. One, I want to commend you for sharing this because it is it is not easy to share, like the you know, the ugliness of financial struggle, you know, And so I want to commend you because that's the first step, is to just say here's the thing that's happening,
and I'm drowning. That's huge, and I hope through therapy, which I'm so glad that you're doing that, you have also been working on forgiving yourself for the financial mistakes you know that brought that brought you here because I always say, you didn't kick anybody's puppy, you know, and we didn't learn about personal finances in school largely, and you know you are not the only I mean, if you know my story, I was three hundred thousand, I was saying, that's why that number was like, oh, child
was over three hundred thousand dollars in debt.
You know, I lost my home to foreclosure.
I made all the financial mistakes possible despite growing up in the household where I learned about money, and so you know, I had to learn to forgive myself first and foremost to say you made mistakes, Tiffany mistakes happened.
I mean, it just is what it is.
I had to get to a space when I was like deep deep deep in this financial hole like you are. I had to get to a space where I said, you know, I was looking for it at first, like this magic wand that was going to make everything better, and I realized it didn't exist. That instead, I had to start looking for what made things less worse. So that I want you to repivot to. I'm not here to actually fix it right now because it's going to
How do I lessen the worseness. So I remember they were literally I had to make a list of like everybody that I owed everyone, like, you know, all of kind of like the financial dirt, and say, who's not going to get anything right now?
They're going to be upset. But I mean I got to feed these kids, you know.
And so one, you probably can't actually spend less, you know, that's just not because if you make five and you owe fourteen monthly, there's no even if you got your five down to zero, you're still in the hole, which is what I were I was too.
So one, I want you to focus on how do I earn more?
You know, like it's actually tax season and I don't know, like you know what, But I would be for you know, you have you have a skill set that can be done on the side as well, you know, And so like for me, I was babysitting, I was tutoring, I was like, how do I earn more? I would not be focusing on how I spend less, because that's actually not going to be helpful. But I would certainly reach out to everyone who I owed and see if there is some sort of workaround or program or pausing because
of the pandemic. Honestly, programs were put into place that you can kind of piggyback on. So that's what I would do, like with my mortgage, with anybody who I owed, letting them all know this is my situation. What are the programs I would apply for everything? So that's first and foremost. Second, I would be asking myself, how do I make more money? Like I'm an accountant, Can I do accounting on the side. When I tell you, every small business person I know is looking for an accountant,
everyone bookkeeper, bookkeeper? Oh yes, Like when I tell you like you are fortunate, like I said, you have a skill set where you can monetize outside of your job. It might look like you're working seven days a week, it might look like you're working to ten or eleven o'clock a night. But desperate times call for desperate measure. So I'd be leaning into what can I earn? What can I earn? What can I earn? I'm so glad that you're selling house a you know this summer. You know,
that would offer you some relief. Hopefully I'm not sure. I'm trying to think when they bought it, but hopefully you'll be able to sell it for more than you purchased it for to help maybe using some of that use some of that money to you know, to help it long ago.
Yeah, so I guessing I was twenty twenty two.
Yeah, so even if you can't, hopefully you'll be able to at least break even on a the new construction. Well, I will say this that new construction usually tends to appreciate because I'm not sure when you purchase the new construction, but hopefully you'll be able to sell it get enough money to definitely cover what you paid for it, and maybe a little bit more to help you with some
of your bills. And as far as B is concerned, you're gonna have to make a decision on whether or not you think putting more money is actually going to stop the bleeding.
Like if I could go back to Tiffany.
When I so, I lost my job when I was like in the two thousand and nine, I was like twenty nine. I had this condo that I bought for two twenty and I spent all of my money from savings, credit cards, everything to try to keep paying the mortgage. I even took all of my money out of my retirement account. I wish I could go back to that Tiffany and say stop, because I didn't have a plan beyond once I spent all this money, where is the money going to come from to continue paying the mortgage.
I should have just said, let me hold on, I'm going to lose this place anyway, let me hold onto the little bit of cash I still have and use it to pivot and transition into a really inexpensive studio
apartment or whatever. But instead I spent all of my money trying to save the condo, and then it was gone anyway, So thirty thousand dollars from my retirement account go on extually, it was more than that because you know, I had to pay taxes, and I had to pay the fee because I was not sixty five and a half, you know, gone. And then on top of that, all
of my savings gone. I had borrowed money gone. So I want you to ask yourself that even if you get the poll done, even if you get the bathroom done, I want you to get with the realtor and ask, if I get all those things done, what's actually the return of my investment? What can I actually sell this house for? And if it's like still less than what
you put into it. I wouldn't even I would take the lone and I honestly I probably would sell it for less and then just have to pay off the balance whatever that is, because you have to ask yourself, like where's the loss the greatest? You know, like I don't want you to continue pour money and only to still be behind. It's like, do I just stop the bleeding, take the l and just pay off whatever that difference is or is it worth it? Because I forget what
it's called. It's called the cost analysis of a house. If I put these things into the house, will I be able to actually sell it and get my money back plus some You know, a realtor will help you with that cost analysis. So I would do that before deciding to put any more money into that house. And so hopefully that's helpful. Side hustle, you're way to some extra money, ask for help from the people that you owe, sell that you know new construction, do the math on
the older home, and make the decision there. Those are those are my suggestions, and continue with the therapy and forgive yourself and you know, and honestly give yourself a little pattern back. I want you to celebrate the awareness that you said, something's wrong here, I'm going to do something to fix it. So I commend you, and I hope you commend yourself.
Yeah, And I think about how she says she just got out of a twenty year financially abusive relationship, and I feel like there's there's probably a lot there in terms of your decision to like take back control of your money and to be like I got this lump sum from selling my home. I have control. I have back full control over what I do with it, and I'm just going to do whatever the hell I want with it. Like I think that's a totally human reaction.
It just seems like unfortunately it was like too much too soon, you know, purchasing. It's one thing to purchase a new construction home, but then to have the fix her upper and like ugh, the renovation like those dragon and like like you said, you know, the unexpected can happen. It's not like you if everything, if the uninspected hadn't happened, if you didn't have that water main brake and you know, had to refinish the master like because of issues, maybe
things would have been fine. You just got like the unlucky side wasn't accounted for. The shit happens side wasn't accounted for. And I feel like that will never happen to you again because now you know. But yeah, I wish you all the best. I would just focus on your kids are the priority, obviously, making sure that they have a roof over their head. I'm wondering what kind of assistance you've reached out for and say you made too much. I'm wondering if it's like food stamps or
like social you know, like social programs. I can understand that. I can understand if there's lots of families going through that. But as far as homeowner assistance, like with your payments, talk to your lender, you know, see what kind of programs they have, See if even in your state they have I don't know what state you're in, they have any COVID era, you know, programs that are still around for home buyer homeowners who are struggling.
Look at hood, yeah, I look.
At HUD also. And then lastly, you ask, you know, do you suggest one on one coaching or one of our courses. I would say no, I feel like you don't need to be paying anyone like my course is not for you, like your your wounds are. This is like triage, you know what I mean? Like this is like you said, how can I stop? Stop the bleeding? And I think that even maybe like the National Foundation for Credit Counseling, you can maybe get a free consultation.
They can help you weigh options like bankruptcy. You know, for example, I don't know there's different types of bankruptcies, and I know that some of them for homeowners who are really struggling. You know, you can you can get to a place where you can let that go and have a semi fresh start. But it's really hard, obviously to give you specific advice without knowing all the details
of your situation. So a credit counselor and a credited credit counselor so of like NFCC dot org is a is a decent place to start if you're looking for that kind of advice. And like Tiffany said, maybe a realtor to help you weigh the like the math side of the situation. But definitely stop the bleeding, stop putting money into the house, and just think about survival and
taking care of your kids right now and yourself. Yes, and talk to friends and have them support you because you need you need support right now because this is not an easy fix. Like you've got a rental, you're still renting off the other house, you're a landlord. It's a lot, Ja, it's a lot. Okay. So I hope you have a good support system beyond us, but of course we're here for you.
Yeah, I'll send you a big old BA hug. You know, I don't eve a hug huge BA hug, but I'm hugging you.
Virtually. Thank you, Jay, Thanks for being vulnerable, Thanks for opening up to us. Don't take that for granted at all. And keep us posted on your journey, okay, and how things are going updates from y'all. Alright, ba fam. That concludes this week's b a QA. Please continue to send your questions to us Brandimbission podcast dot com. That's where you can find all the different ways to do that, or hit us up on ig at Brand Ambition Podcast.
All right, baa Arimandra, Bye bye