How to Save Money When Buying a House + Can Refinancing Really Save You Money?

archives and find. But today is specifically for potential homeowners or homeowners that are looking to refinance because it is such a great time to refinance. Yes, and both Jen and I have done both of these things and just to home and Jen just refinanced, so we can speak from our own experience also yep, and we will be doing that. So we are gonna talk about our sponsors and then hop into the episode there. Our first sponsor

is the Frugal Friends work Book. Yes, so uh, this is a project Jill and I worked so very hard on and we've been getting such great feedback from you guys that have already started going through it since we've launched it a month ago at this point. So whether you're new to budgeting or just trying to reach a big financial goal like paying off debt, and you need something to get you out of your rut, something to

re motivate you. That's what the Frugal Friends work Book is for, so people starting out or people that need some like revitalization to their journey. This is a six week long dig uitual workbook with six one week challenges that are going to help you save money, simplify your life, um, improve money conversations, and more. And those can be done

over six consecutive weeks or one at a time. The workbook is over sixty pages of content, so it is jam packed and you can do it on your own, but it's actually designed to be gone through in pairs or small groups. So that's why every single purchase comes with two downloads, so you are more than welcome to share it for free or split the cost with someone.

We want you to do that, So had to Frugal Friends podcast dot com slash Workbook to learn more and use the code taco bell all one word you know how to spell it to get ten dollars off the regular price nice also brought to you by very high price tags on seemingly insignificant low cost I had ms, Well, we have a complicated sponsor today, but it's quite fitting as we discuss home buying. Take stamps, for example, what one would think costs fifty five cents and be used

to mail a letter. When it comes to home buying. This is nowhere near what the word stamps mean. No, no, no, stamps are hundreds of dollars. You never actually see them, nothing gets mailed anywhere as a result, but they are apparently necessary and there's no circumventing them high price tags on what should be low cost items. It's all part of the home buying magic. Oh my gosh. We asked the same question again when we refinance, Like, what the

heck is the is the stamp fee? And not even the woman they're new Uh so she was not the title company, she worked for the credit union. But whatever. Yeah, these stamps, I don't think they're actual, Like I think it's like notary stamp ap type things. Some of it is. There's tons of different types of stamps. There's text stamps and yeah, the notary stamps, and I'm just like, what kind of ink are we using here that? Yeah, can

I get my mom to do it? It just feels like there are some really arbitrary things that it's just like and this and this, and this and and and you're just demoralized by the end of it. I know it is. It's tough. So there are some things you just cannot get around when you're buying a home or refinancings.

So that's why it's so important to know the things that you can control, negotiate, and lower so that you can do those things and then you don't have to feel so guilty or demoralized by paying, you know, five dollars for stamps. So that brings us to our first article. It's from the Lenders Network and it is seven ways to save money when buying a house. Yes, I like the first tip We're just going to dive right in, and that is to use an experienced local real estate agent.

I definitely agree with this one, and thank you Jen for your recommendation on our real estate agent that we were able to use. Kyle. Shout out to Kyle uh So as some of you know that I'm We moved from Pennsylvania to Florida, so it was really important for us to get a local person who knew the area and would be able to help guide us in that way. But also I like the tips that this article makes

about using a real estate agent. I think sometimes there's this um conception that we would be able to save if we could cut out the agent. But particularly when purchase saying as buyers, we don't pay the real estate agent fees. That is typically the seller who pays that. And especially if this is your first hometime home buying experience,

then there's a lot of unknowns. There's a lot of weeds to dig through that I would suggest going through a real estate agent, particularly if if it's your first time.

You know, some people are like, let's I mean Eric and I we were like, let's try to cut out the middleman and buy directly from a seller, And after having walked through it, I'm so glad that we didn't for time purposes, energy, the headache of it, I think it is very possible that we could have lost more money on that kind of transaction just because we didn't

fully know what we were doing. Yeah, research can get you a long way, but just somebody who knows the area, knows the market has Uh, negotiating power is able to help you in knowing where you can cut costs, like he our real estate agent was worth every dime that the cellerbated to him. Yes, and it's this is such an important thing two have because you are not actually

as a buyer, you're not spending money on it. Um. But it's so important because yeah, he an experienced local real estate agent can save you so much money in negotiating. And not all local real estate agents are experienced or created equally. Like everyone and their mom has a friend who's a real estate agent. And so it's really important to like go with your gut, go with someone who's

going to go to bat for you. Like when we bought our house, our real estate agent was like, I'll cut my I'll cut my like fee, um, you know, one percent in order to get this family into this home. Like, go with someone who will go too bad for you for me. That tends I find it tends to be younger people. So maybe people who have not been as jaded or complacent. Um, and somebody, Yeah, somebody who's like

really like Kyle your real estate agent. He has a few investment properties too, so he just like loves real estate. He loves finding a deal. Um, he's great at negotiating. Yes, great listener. I mean yeah, we could almost do an episode on like how to Find a good real estate agent. There's a couple of things that stood out to me that Kyle was like, Thank goodness, Um, but yes, able to negotiate, is super tenacious and and a good listener.

It's funny because during part of that process we did work like we we had to interact with another real estate agent, and I realized, like comparing the two of them, I'm like, this person was not a good center. I did not feel heard by them. If they had been the one walking me through this home buying process, I wouldn't have trusted them. It would have been like, no, I just told you that here's the things I'm looking for in a house or what I want to do

to a house, and you totally did not hear me. Yeah, so there's a lot of find a good one. I'm agreeing with you, Jen and saying finding find a good one. And they do have the ability to help you save money in the process. Yeah, definitely. And if you are with someone and you are deep in the process and you find that you are unhappy with them. They're not listening to you and you're just not having a good experience. You are not obligated to them, you have not signed

a contract to them. Find somebody who will go to bat for you. So yeah, as it's don't be a jerk about it, but you should feel comfortable and heard, uh and be with someone who is really there for you and not just for the commission. Well, so yeah. Um. The second one is to get loan quotes from multiple lenders. Um. So we we did not do this when we were

buying our home. Super inexperience. So when we found it, we just went with the um with the lender, with the guy that our realtor recommended, So we just went to him. We didn't seek out other options because we didn't know that was a thing, And so we got the average of what was you know, being given at the time. So it's not like we got a really bad deal, but um, it was with Wells Fargo, And honestly, I don't like the fact that I gave that much money to Wells Fargo as a company in general. Um,

so look around, um, look at the average. You don't have to get pre qualified, but you can look at though getting prequalified does not hurt your credit. Um, you can just look at what everybody is offering, um, you know, around your area. Start with your local credit unions. I mean, you can go online to see what online lenders are offering. So just google, um, you know, today's mortgage rates or something, and you can find a bunch of Nerdwallet, bank rate,

all kinds of things with the best rates for mortgages. Yeah. Nice. Yeah, shopping around I think that was something I didn't realize that you could do. We kind of did it by default because we got pre approved before we were necessarily ready to buy a house or we're seriously looking. We were a little bit more curious. And then by the time we were ready to buy a house, we ended up going with a different lender, and so we were

able to compare that way. But I didn't realize that there could be, um, such a difference between lenders and and really it's probably going to be by percentages. But it still is worth shopping around. Yeah. One more thing that the article says that it's important to note is once you have looked at all of these things, get actual loan quotes from three to four different mortgage companies, um.

And then on those loan quotes, you'll be able to see the exact fees that each lender charges, and then you can use those loan quotes to help you negotiate lower fees and rates from the lender that you choose. So, uh, definitely get the loan quotes from a few, but check out a variety. Yeah. Nice. The next thing that stood out on this list to me is number five, which is find a house that needs some work. So if we're talking about saving money when it comes to home buying,

this is definitely one of the those areas. And you know that we all come from different skill sets, backgrounds, abilities, desire to fix up our own house. Um. Of course you know, a turnkey, ready home at a price that's affordable for us, it would be great, um, But everybody's looking for that, as this article points out, and so being willing to be flexible a bit on how ready the home is for you to live your best life now in it can really help to save you some money.

And especially if you can see past um some imperfections or some aesthetic things, you could get a house for less than maybe even what it's worth because it just doesn't look that great and then take your time loving it, making it look nice, making it what you want it to be. UM. So, And and that would include either hiring some of that work out doing some of it yourself,

you know, painting, doing your own decorating. Obviously that's um that's what we want to do as frugal folks, but not just looking for something that has the sparkling white countertops and the brand new appliances UM can definitely help to save your budget in this process. Yeah, and I'd also like to point out is that just because you find a house that needs some work doesn't mean you

have to do the work. So looking for that and seeing the average prices for UM for contractors or anybody that renovates whatever you're looking to renovate in the house and seeing if okay, if I get this house and I hire somebody to do the countertops, what is and then take whatever they quote you and take a few grand off of it, because you'll definitely negotiate down UM and see is this cheaper than the other houses I've

looked at that actually have the countertops done. So you have to just take into consideration everything going on and see if somebody does all the work for me, is it's still going to be cheaper than buying it like already done for me. Yeah, it always makes a sometimes it won't. Yeah, not that this is a great picture of reality, but on a lot of these home buying TV shows, when people are going through homes and people

like I just don't like the cabinets. I don't think I'm going to go with it, and like, you're not going to buy a home for hundreds of thousands of dollars because of a five thousand dot, like a potential five thousand dollar fix, Like, yeah, I think sometimes we need to have this mindset of, well, what is more advantageous for me to get a home for forty dollars less than what I like, maybe this other home that's turned key ready, because the fixes are are not going

to equate to that extra spending on that other home. So yeah, do some calculations. And it doesn't mean that you're d I y ng the fixes, Like you said, Jen, you could hire somebody for some of it and still be spending less. Yeah, And I mean think if you're saving up and paying cash for these fixes, that and maybe the fixes add up to thirty grand. Well, that's thirty grand you didn't have to get in your mortgage.

So whether you're you're at three, that is you're saving that um as long as you don't finance the fixes, because sometimes those those financing those can definitely be more than four percent. So take all that into consideration. The next one that I like is number four, and it's increase your credit score. So divisive, such a divisive topics into it and so miss under stood. I I very

rarely find somebody on the street that like understands credit scores. UM. So it's just they're so important, and I think they a lot of people in the you know, debt free community. You should be paying more attention to your credit score, but you should understand it because a lot of the age old you know, things that people say about credit scores are necessarily true anymore. Like you don't have to keep balance on a credit card to increase your credit score,

Like that's a that's a max. That's a max that people say. If you can pay off your credit card every month, then you absolutely should UM. And you don't have to have a credit card to build credit. You can ask your uh landlord to sign up for a company where they can report your rent payments as to the credit bureaus. So that is something you can do and you can get credit for your rent payments. UM.

So it's such an important thing to know. But if you are trying to increase your credit score, then there's two really important things that you should do, and there's a there's a bunch of things, but like, the main thing that you should be working on is paying down your debt balances. So hopefully that's high interest in credit card debt like first, um. And if you don't have that, then student loan debt um. And then the next is right when you know you're going to buy a house,

don't apply for any new loans your credit. So give yourself four to six months before you start getting pre approved for a home before like puts four to six months between you and any new credit applications. So hard credit inquiries, UM. Those those are kind of the two

most important things specifically when you're looking to buy a house. Yeah, but if you have credit questions, please bring them up in the Frugal Friends community on Facebook um and tag me in them, because I don't see everything that happens in the group, but um, I would love to answer your credit questions because I'm passionate that more people need to understand credit uh and and more people can improve their credit. It's easier to do than people make it

out to seem. You don't need any you don't need to hire anybody to do it for you. You could do everything yourself very easily. Nice. Thanks, Jen, that's helpful. I just picked your brain the other day on a credit question and it was fantastic. Yes. Then tip that stood out to me on this list was number seven, which is purchased a home in the winter. So this is this to me, feels like one of those wedding tips, like have your wedding on a Sunday or or a

Monday and instead. Um, so you know that I have not done the research myself on this, but they are claiming that most people are in the market for a home in the spring and summertimes, which would make sense. A lot of people want to get into a home before the new school year starts to kind of make a swift change for kids, so the time of year can dictate what the housing market is doing and demanding the most the highest prices in those spring and summer months,

So uh. They claim that you can save as much as twenty dollars if you are purchasing a home in the winter months. So something to consider, um sacrificing. Maybe when you'd want to purchase a home, do it in the winter, move in the snow if you live in the north, and save yourself a couple grand. Yeah, I mean I might agree with this. We had we bought our home in February, um in on in the month of February a few years ago, and just got an

fantastic deal on it, like an unreasonably unreasonably great deal. Um. And then our friends who bought a similar home maybe like a little bit bigger, paid about forty grand more than us um. And I mean I don't think their home was worth more than twenty grand more so I might agree with this, um. And like, think about when you would want to sell your home like it's or buy a home like it's very inconvenient to buy around

the holidays. So but that would also mean it's fewer people are going to post their home around the holidays too, So it's kind of just you know, there's ups and downs to purchasing in the winter. Uh So, but definitely look for deals. Then I don't know if we'll see any deals this winter because the housing market is like it's such a buyer's market. UM, but maybe next winter.

And this is where you can ask your experienced local real estate agent of what they've seen, What are the areas that are, you know, the least expensive, What are they seeing trends being year after year. And that's where the experienced part comes in that they've been doing this for years to be able to tell you that answer. Yeah, like they actually take the time to research because they like it. UM. The last one we're going to go over on this one is number six and that is

get the right type of mortgage loan so UM. I know Dave Ramsey loves the conventional mortgage loan UM and that is that is the cheapest typically cheapest mortgage loan UM. But there are other types and that doesn't mean they're bad so V A, F s A. Those are totally fine when you're when you're first purchasing a home. UM, do do what's best for you U S d A loans. If you can get something from the Department of Agriculture, those are even better, UM because you always have the

option to refinance in a few years. Whatever loan you pick right now, you're not married to it, UH, you will hopefully raise the value of your house in two years and you can refinance to a much more affordable conventional loan. UM. You should no matter what mortgage you end up with. UM. I think the real thing that's going to save you money on your mortgage UM is making sure that you first have the money to do any improvements up front UM that you need to do

to raise the value of your home. So that may mean choosing a thirty year mortgage up front. That's that's what that looked like for us UM, and then when you look to refinance, then looking for that optimal low cost um mortgage loan. But that's that's what I think about it. I'm not married. I like for your first initial mortgage loan, I think you should, you know, do whatever you need to do to get it if you're

financially ready. Obviously caveat to that. Make sure you're financially ready, because it does it costs more or than you think it will to purchase a home. There are all sorts of stamps, so many stamps. Gosh, the list of fees, yeah, yeah, it's unfortunately not right now. It's not just enough to have your down payment saved, you have to have thousands of extra dollars also saved for the closing costs. Yeah. Yeah, sometimes your seller pays for that, but I would still

buffer a couple of thousand dollars beyond your down payment. Yeah, and that's so that's another one that we didn't go over on this list was having down for your mortgage. I don't think you need that for your first if it's your first home, I think you're far better putting that money towards uh, increasing the value of the home and getting the stuff purchased that you need to buy, um, you know, because and then getting to that point in two years you can refinance and get the p m

I off. Yeah, which we'll talk about later as well, but more reasons for that. But now that we've talked about refinancing, let's just start. Let's start in on that one. What's so you're the refinancing expert on this one. I just bought early, but tell us let's stood out to you, Jen,

since you just refinanced. Yeah. So this one is six ways to save on a mortgage refinance, and it's from mortgage loan dot Com And the first one on the list is to pay closing costs and points up front so you can roll your closing costs into your loan um. And that is very common. But I so I just say, look at mortgage calculators online and test, test and find out because points and closing costs are going to vary

all the time. And honestly, we got to the end of it and are the closing costs they actually charge us for were was cheaper than what they said it was going to be. And we were so confused. And it's not like they didn't charge us for the first month of the mortgage because that's still coming out, you know, in two months. But so we paid all of our closing costs up front because we did not want to pay interest on that over you know, the life of

our loan. Uh. But we then plugged in the points, uh plugged in like one point on our in our mortgage calculator. They'll offer you different levels of points, like different numbers, and you just have to plug in whatever they're offering you. Uh. So we plugged that in and found out actually getting the points made it a little more expensive. Yeah, So and and maybe we didn't plug

in all of them. They do a an example in this article, they do three different examples where um they're doing I think like one point, um two and a half points, one and a half points, and the one in the middle actually ended up saving the most, so it saved more than the one point or the two and a half points. And just to clarify because this is something I did not know in my home buying experience, but points are a fee that you pay to buy

a lower interest rate. UM. So if for whatever reason, you don't qualify for a certain interest rate, or there is a better interest rate available to you, but you have to purchase it, you know, kind of like bribery, but it's points, So one pin point, Purchasing one point might get you a certain um interest rate. Two points would get you maybe a little bit better of an interest rate. You know. There's there's more to the points than than my simple explanation, but that's essentially what it is.

A point buys you a certain interest rate. Yeah, so going online to a mortgage calculator and plugging in all of your options so without points, um paying closing costs up front versus rolling them in and then with every single thing with the points, So just taking the time to do that and choosing the one that's right for you. Nice. The second tip on here is improving your credit score.

So again similar to what was listed on the first article, um that this is important to have a good credit score either when buying a home or refinancing a home. And so back to Jen with her tips and ask her questions. Tag her in our Facebook community group on

ways to improve your credit score. Yeah, it's yeah, it's so important that you're checking your credit report, doing your annual credit report dot com once a year and seeing what's on there, and then if you see anything, um any like negative dings that you're trying to get those off. So first you try and get off the ones that for accounts that are already paid off, those are really easy to get those, you know, those dings off um.

But then also if it's it's a account that maybe you had a missed payment but now you're current and you've been current for a while, then you know call and try and get those off sending those um those letters.

So just be diligent about it and start now even if you're not trying to refinanceer by a home so that you don't have to worry about it all in you know, when it comes down to it, because you you want to give Once you take those things off your credit score or credit report, you want to give a few months buffer um to have it all show up.

So yeah, credit scores are important. Um. Also, when doing a refinance, don't take cash out, so cash out refinances are super uh popular special when people want to pay off debt with a cash out refinance, and sometimes that can be it can look enticing, but doing a cash out refinance will always be more expensive than a regular refinance, so you'll be paying a slight premium on the rate um. That's what the article says. Um. But it could also cause you to lose equity in your home if home

value start dropping again. So if you decide to move in a few years, that money you cashed out with a refi could eliminate all your home equity. Don't assume whatever house you're in is going to be like you're forever home. Always work in the assumption that you should be able to break even in a few years to two years is ideal um. And then you want to stay in your house, you know, at least five to seven years beyond your break even to get the best

value from your mortgage or your or your refi. That's kind of like industry standard. Yeah. The next on the list is to shop around. So similar to what we talked about when home buying, to shop around look for different lenders. The same is true in refinancing. You can look for the best price UM. Again, as Jen said, you're not married to your lender, so you can you can see who's got the best interest rate for you. Yeah.

We so we debated between UM just getting p m I off and doing our sticking with our same UH loan until we shopped around UM and realized how much lower the refinance rates were this year, so we last year they were a little higher UM. So that's when we were looking at doing that. It would just be five bucks to get an appraisal and then we would

get p m I off UM. But at the end of last year when rates dropped, UM, we weren't looking and we started looking when you know, when the bottom fell out of the world this year and found so much variation. So it made me feel better. I didn't have to go with Wells far ago um. And we're actually at our local union, and that was as a personal decision I made because I wanted to be at

a credit union versus a bank. Nothing against banks, um, I just really like the work that my local credit union does in our community, So I didn't do as much shopping around as I might have otherwise. So also think about where your money is going, because you're gonna be paying a lot in interest on your mortgage, So if you want that money to be going back into your community, consider the bank or credit union where your loan is taken out of. Yeah, right, which is the

the next tip. You can either shop around. I mean, definitely shop around, but it's also okay to just stick with your your lender currently if you've you've got history, it's at least going to be less paperwork, and it's possible that they are the ones who could offer you the best refinancing rates. So true, I don't assume that like because you shop around, that is going to mean you have to make a switch just to stick it

to them. Like you can say, with the lender you have history with and still get a great rate, save money, save sometimes save some headache. Yeah, definitely. Um. And then The last thing we'll talk about on this is to prepare for your appraisal. So um not every mortgage refinance requires an appraisal ours did um and it is something that you will pay money for and usually have to use their appraiser um. But you can also ask if

you can use your own appraiser um. But yeah, So get your house like almost sail ready, just like the outside of the house. You don't have to like set it up to take pictures or anything, but spruce up the front yard. If you have home projects that you are working on, finish them before the appraisal. Just get the house looking I eat, and then that could help bring up the value of your home um and that

will save you money on your rate. Yeah. I mean certainly if you've got an unfinished kitchen or bathroom renovation that needs to be done before that appraiser walks through, Yeah, definitely. You know what else needs to be done, The best time of the week always needs to be done every week, the bill of the week. That's right, it's time for the best minute of your entire week. Maybe a baby was born and his name is William. Maybe you paid off your mortgage, maybe your car died, and you're happy

to not have to pay that bill anymore. Build Buffalo bills, Bill Clinton, this is the bill of the week. Hey, Jen and Jill. This is Luisa from Boise, Idaho. First off, I want to say I love the podcast Keep killing It ladies. Second, my bill the week is my transportation bill. Living in Boise, you have to own a car to get to most places since I'm required to work from home during the pandemic, I haven't gotten gas in forty four days. Normally I fill my tank every two weeks,

so this is awesome. I love being able to gamify my driving to see how long I can go before I have to fill up. Plus I need to look at all the bright sides of the pandemic. Thanks for loving me share, keep on keeping on my fro good friends. Oh, Luisa, Well, four days forty four days, that's more than a month. That's nearly a month and a half. Oh my gosh, you remember quarantine, Jill. Yes, we got to quarantine together,

and I feel that we didn't go anywhere. Nope, Oh man, flashbacks should have gamified it, though, I'm more so mourned, grieved, and lamented, But my goodness did she have a better approach and gamifying it lips. Well, yeah, I remember thinking this feels a lot like paying off debt. This is what my life was like when we paid off debt. And I did this for the reason so I'd never

have to do it again. But here we are. So if you're wondering what it's like, just recreate quarantine for a while and you should be able to pay off your debt. And you've already done it once, so try it again and it'll be fine. And see if you can go forty four days without paying it without buying gas. So great, see what happens? Well, yeah, thanks so much, Louisa.

If you have a fun bill of the weed that you want to send us, please visit Frugal Friends podcast dot com slash bill and leave us a voicemail or a speak pipe message, depending on the device. Yourn. Yeah, now it's time for round. It sounds. I know it sounds so lonely. I just wanted to sound hear what it sounded lightning just to you. But I feel like our voices really create, like a good sound to get

lightning a chorus? Yeah, now be be the thunder. That's all every time, every time we say it, that's what I think of. That sound amazing. That's Tampa Bay. So for today's lightning round, we're talking about a few other ways to save on homeownership. So these are things you can do in the meantime when you're not trying to buy a house or refinance a house. Yeah, go for it. The first one is home insurance. So we personally have a government UM subsidized plan that is cheapest for us UM,

but that's not the case for everyone. So sometimes you can get cheaper rates by seeing like buying private home insurance or bundling it with something else, they'll like match it or beat it. So even if you have one of those government subsidized plans available to you, you should still be checking around shopping around for rates UM and then also check for UM like discounts you can get. So are there things qualities about the home that if it has this thing, you will get a discount on

your rate. So there were several things that our home you know, had, but also didn't have, So as we were doing updates to the house, we were able to intentionally include those changes UM in order to qualify for those discounts. So one of those was hurricane straps for a roof. We um there's like a four point roof thing that you need to get the discount, and we had three. We didn't have the hurricane straps, but after several trees fell on our roof, we ended up needing

a roof from placement. So when we got that, we made sure that we asked, intentionally asked, hey, put these straps on, and that gave us a significant discount of our home insurance um every year. So just be on the lookout for those discounts um when you're shopping for a home. Ask does the home have these things so that I can get a home insurance discount? Or you know, is the roof old enough where I'll need to replace it and I can get that discount pretty quickly. Stuff

like that. Yeah, it's it's good to know that these things exist, that there's improvements that can be made to your home that can save you money in the long run. So I would also add to this, and we already mentioned it a bit, but calculating if you might save more by not putting down on a home when you are purchasing. So a lot of the reason that a lot of people say don't buy a home until you have down is because of p m I that that

mortgage insurance. But p m I usually cost point five to one percent of the loan, it may not actually be that large of a sum of money. And and if that is the one thing keeping you from purchasing a home, it's worth calculating your costs of how much is it costing you right now to rent, what is the percentage increase of how the housing market year over year in your area? What will it cost you in the long run to wait until you have twenty down

versus buying now at ten to fifteen percent down. I know for Eric and I, we you know, we had the aim of down, but once we actually looked at our p m I is something like forty bucks a month, which to me is not a large sum of money for us to have been able to get into a home. And we kept the other money aside so that we can start cash flowing renovations quickly get rid of that

p m I increase the value of our home. Like there there are situations where it could be worth going with less than twenty down because of what it can

afford you in the immediacy. MM hmm. Yeah, calculate And that's something else you should get when you're getting like loan um when you're shopping around for mortgage rates, see what p M I will be um and if it's you know, if it's forty a month, ask yourself, is paying forty a month worth it to like be in a house and to be able to immediately start working on renovations that could start to bring us in more money if we are able to um bring in some

income off of our property. So yeah, tons of things to consider with that. It's ultimately not always a one size fits all. There is great advice out there, but it's also worth looking into doing some calculations, considering your individual circumstances for what makes the most sense for you. Yeah, we put three percent down, but we were in the middle of paying off debt and that was that was

a whirlwind. I don't know how that worked out, but you're at a beautiful home, yes, And and so we put three percent down, got a thirty year mortgage, and then three years later we have refinanced. We are now in a teen year um our rate is half of what it was, so I mean almost half of what it was. And I'm happy it's right because also when we got into the house, um, we were able to start renting out our guest room on Airbnb. That's that's my next way to save Um it's actually like monetize

your home. But we it was just Travis and I, so we put our front guest room up on Airbnb and we chargedly thirty five bucks a night for it. So nothing crazy because we're sharing space and it takes a certain type of person to be willing to share somebody else's home. Um, and that person is usually pretty cool. So it's a little different now like in our current climate,

but uh, definitely still worth doing. Again. The type of person that will share somebody's home after a pandemic is just a certain type of person and they are typically pretty cool. So I think we had we could. We had like almost a hundred guests, and I can name on one hand how many I didn't like, So that's great. Those are typically I really liked that great ratio. My final tip is for saving money in the home buying process is to consider purchasing a home in a lower

cost of living area. So this could include looking a bit outside of the radius that you were hoping to purchase in it could also mean a massive move altogether. This is coming from personal experience. It's a big reason why Eric and I moved to Florida. I mean, first of all, we both work remotely, so we were able to move and our jobs were not a factor in that. We were able to maintain our employment and pretty much go wherever we wanted. So that was huge for our

ability to do this. But when we were ready to purchase a home, we started to realize, Wow, we can barely afford to live in the area that we've been living in, and if we want to buy a home, we may need to look elsewhere. Um. And it turns out for us, Florida was an elsewhere that provided quite the house for our price range. We could not be more thrilled that we can afford the house that we

ended up buying. We would not be able to get anything like what we're living in now up north, So for us that was a consideration um, and a move worth doing. Mm hmm. Yeah. And this is such this is a controversial topic, I guess too, because when you're trying to pay off debt or reach like a really big financial goal, usually I mean people look at their budget and they just assume the costs that they're paying for housing is what they have to pay, and they're

looking to scrimp and save on groceries and utilities. Um, but if you were in a high cost of living area and you have the physical ability to move somewhere else for a little while, then that could be the answer to your budgeting questions. I mean, so it won't be that way for everyone, um, but maybe like ten people and so maybe there's like a few people listening to where like that's the answer to their budgeting problem. Yea, So there are other reasons I understand why people would

not want to just up and move. And I'm not saying that it was a super simple process and decision for us, But at the end of the day, we recognized ultimately this is a great area to invest in. So even if we want to move back up north, we could sell it at a profit, we could rent it out. This is just a killer area that still happens to be less expensive than from where we came.

So it, yes, it is a consideration. Just like when I lived in a motor home and I knew this is not for everybody, but there could be somebody out there who's listening, and this is a solution. So whether it's tiny living or moving to a lower cost of living area, there there are some hacks if you're willing to think outside the box, if you're willing to sacrifice in some areas for a couple of years, there are some solutions if we're willing to go a bit bigger

than maybe where we typically might be thinking. Yea, so I hope that you got at least one nugget from the last fifty minutes and you will take that and save a lot of money because homeownership is expensive and it is not always an investment, but there are ways to save and we hope this episode could save you some money over your lifetime. And uh, thanks so much for listening. We want to thank you also for your kind reviews on iTunes and Stitcher like this one just

happens to be five stars. It's from Cal Patton says, smart, fun and genuine a personal finance podcast that feels like you're talking to really smart friends. Jen and Jill do their research and you'll definitely learn, but with a smile. Topics are well thought out and not the same over general topics routinely covered in other personal finance podcasts. The show is super fun, quirky, and most importantly genuine. Flaws claimed. Air is admitted, lessons learned, and all shared in the

most upbeat way. It feels like wine with the girls while the boys are away. So true. Cal Petton, thank you so much for your kind words and calling us smart. Wow, my mom appreciates that. We also want to thank our friends who share these episodes on social media. So when you share the latest episode, the most recent episode and tag us on Facebook or Instagram, we are adding you to our monthly drawing. So for every five tags and reviews we get each month, we will give away one

copy of the Frugal Friends workbook. Yeah, so keep leaving us those reviews on iTunes and Stitcher and sending the screenshot to Frugal Friends Podcast at gmail dot com. And don't forget to tag us on social We will see those if they're tagged at Frugal Friends Podcast. See you next week. Bye. Frugal Friends is produced, edited and fixed by Eric Syria. We're sitting in this weird place where are finance actually hasn't gone through, so we have two

mortgages for one house. Yeah, it's pretty Have you had to pay two mortgages? No? No, no no. Even if for some reason it doesn't go through, we don't actually have to pay. We don't have to pay the first um month mortgage because that was in the closing costs. So for some something goes wrong, then we're still okay, Okay. When do you expect to hear back? Uh? I don't know.

We won't really hear about it until it goes through from Wells Fargo, and then in about three weeks after we'll get a check for the overage because there's a little overage. Um, we will accidentally get about a grand back because it took so long to process the refinance because it's um so everything takes longer everything. Yeah. So well, I hope that comes through for you soon. Me too. I really don't want to pay Wells Fargo again. I'm going to see if it's not gone through by the

end of the week, I will call them Friday. Good plan. Thanks glad everybody knows that. Now that's my plan for the week. I stay accountable.