“You’re in Such a Mess, I Don’t Even Know Where To Start”
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- Опубліковано 27 вер 2024
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I never understand how some people can say they "outgrew their house". They be having 3 bedrooms home with 1 child and act like they can't walk in there.
Dave is absolutely right when he says theres nothing wrong with renting when you cant afford a house.
Nothing wrong with renting if you can't afford to buy. But if you can't afford to buy and have no tangible plan to be able to afford it, you do have a problem
I've picked that up through the years, he would even tell people to rather rent until they can put down a deposit rather than go into the sale with payments they eventually will not be able to afford.
there is nothing wrong with renting when you CAN afford to buy a house.
In fact, depending where you are from renting makes more financial sense than buying.
@@brucewayne3892That’s a very US centric view (which is perfectly ok as it’s a US centric show) but throughout the UK and Europe lifelong rental is a perfectly normal thing.
@@JoelWende yeah but Europe is a failing content. So....
Ashamed to admit this is my favorite type of ramsey content
I learn the most from these types of situations
Train Wreck
Hey, you like what you like.
It might sound silly but hearing this stuff over and over scared me into realizing you have to assume things will go sideways and it’s not your fault if someone else didn’t prepare for it.
Same here.
Anytime a parent comes to you with a "deal", have a talk with an attorney before you do anything.
🤣🤣🤣🤣
Lmfao America 😂
Sorry you had bad parents
Literally! It’s crazy the parents agreed to this. Or allowed this.
Had neighbors with wife constantly saying they "needed bigger house", and got big, new house...leading right into money issues and divorce.
I refuse to be house poor. I'll live in an RV before I go broke for a house
Even worse striking deals with family members. A sure way to be hearing about it 24/7 when something goes wrong. I want to strike out and learn on my own with no family involved. My old man always told me no free lunches in the world, well there's no free lunches when it comes to family wheeling and dealing. It always ends in a disaster and with someone getting hurt.
My uncle has a friend whose wife kicked him out. He took his RV to my uncle’s house and pays him $200 a month for “rent”. Has his RV hooked up to my uncle’s electricity and water/sewer.
I also refused to that after hearing horror histories in Dave Ramsey show and also listening to Warren buffets talk about the margin of safety concept
@@crowtservo that’s crazy 😂
That electric bill is gonna be thru the roof lol
Same
Can't pay his bills so he buys a bigger house
this happens all the time
Parents knowing that is just awful
They have to have their cake and eat it too. Ya got a smaller house. Nah, that's not good enough because it will look bad.
The problem we have is because Most people always taught that " you only need a good job to become rich " . These billionaires are operating on a whole other playbook that many don't even know exists.
Money invested is far better than money saved , when you invest it gives you the opportunity to increase your financial worth.
It is remarkable how much long term
advantage people like us have gotten by trying to be consistently not stupid,
instead of trying to be very intelligent.
The wisest thing that should be on everyone mind currently should be to invest in different streams of income that doesn't depend on government paycheck, especially with the current economic crisis around the world. This is still a time to invest in Stocks, Forex and Digital currencies.
Many individuals report success in investing in stocks, forex, and cryptocurrency (Bitcoin), yet I continue to struggle. Can somebody help me out or advise me on what to do?
Even with the right technique and assets some investors would still make more than others. As an investor, you should've known that by now that nothing beats experience and that's final. Personally I had to reach out to a stock expert for guidance which is how I was able to grow my account close to $35k, withdraw my profit right before the correction and now I'm buying again.
The parents are using their son for their retirement income. reverse screw
How did they screw him?
They haven’t gotten a dime from him and they “sold it” below market value
@@SweetPotata10 relisten to the phone call, he doesn't "own" the home. The home is still in his parent's name. He is renting the home from the parents. All this 'home equity" stuff hasn't happened yet. The reverse screw: The parents are getting their son to pay off their mortgage. The parents probably know the son's income is not high enough to qualify for a home loan.
@@cutehumorson could've said no.
@@TitoMolina604 The son sounds like a clueless idiot. He doesn't seem to realize you don't own a car or a house unless your name is on the title. He doesn't seem to know the basics of buying a house or financing a house. I real sorry for his wife marrying such a clueless financial illiterate.
I sort of sigh when I hear "we outgrew the house." When I was growing up, it was common for families with three or four children to live in a three bedroom house with one bathroom. Kids shared bedrroms. People found a way to get washed up and out in the morning, even if Mom worked, too.
1) should have gotten out of debt before trying to upgrade their house. 2) shouldn’t have tried to buy a house they couldn’t afford 3) shouldn’t have gotten into a deal with their relatives.
Oh boy, seems like one of those Ramsey videos that makes me grateful for my own situation.
Basically dad and mom screwed their kid… bless their hearts.
Parents probably not good with money so as to be expected
That's most Ramsey videos
That's pretty much the only reason I watch this show.
You’re horrible.
Amen right. Glad I’m where I’m at. What a mess this is.
People need to work on their self worth and insecurities. Buying these house when you know you can’t afford is solely because they have bruised ego and insecurity.
Also “family” so it “will just work out.” As someone who did a hard money deal on a house with parents that fell through, it doesn’t always work.
The guy is not even close to buying the house. He needs to get his vocabulary and thought processes in line with reality. He seems to be totally clueless about real estate and financing a home purchase. He needs to disengage from his parents, act like a grown man, and buy a house from an outsider. This nonsense of depending on the parents to purchase a home needs to go.
If your name is not on the loan, then you can't call the mortgage company to ask about it.
The son is basically a reverse mortgage company now. But with no legal recourse. Ridiculous. People please don't "help your parents out" by buying their home from them. Tell them to put it on the open market and get the best deal. And you live wherever the FLIP you want. I don't trust your parents.
They should have legal recourse, just secondary to the bank that has the mortgage. If the parents don't have any other assets, they might be judgment proof after the house is foreclosed on, though.
I bought my parents house. Paid appraised value for 5 acres of land with a house my dad built himself. We’ve been here for 17 years and couldn’t be happier.
What makes you think he’s helping his parents out by buying below market value, especially he said he needed a bigger home since he outgrew his?
Also if one of the parents ends up in a nursing home… they’ll take the house.
Or, the kids (adult children) will be encouraged to help the parents for as long as they can.
@@ronaldlindeman6136what's wrong with helping?
Who will take the house?
@@kbanghart Medicaid reimbursement lien
A Medicaid lien on a home must eventually be satisfied. Typically, a Medicaid lien is placed on real property when an individual is receiving benefits through the Medicaid program during his or her lifetime and still owns a primary residence. Even when the home is exempt, it can become subject to a lien when the Medicaid recipient passes away.
@@kbanghart The state. As part of Obacare or during his administration a Federal law was implemented that required every state to put into place programs to seize assets of any person whose long term care whether at a facility or in the home was paid for by any state Medicaid funds. A surviving spouse may live there until their death, but then it is taken by the state. just as with taxes, somes states are more confiscatory than others. But they take any real estate at very least until amount paid by state is satistifed.
People are in such a frenzy to buy a house, they will do anything to technically “own” one right now.
and truthfully, you never own it until it is paid off. Just like your fancy car, motorcycle, boat, etc.
Even if its paid off, you never truly own it. You still have to pay property taxes, or they'll rip that property right from under you.
You either own it with the deed in your name or you don't. Basic real estate 101.
@@FreeAgent797 Well that is true. However, I think it is easier to pay taxes when you do not owe any money on it.
They have nowhere to go to pay off the 30k. Wife doesn't work, two kids, energy bill just went up trying to heat and cool the bigger home. Dude needs a raise very soon.
He needs a wake up to reality moment before a raise.
Parents taking advantage of the housing situation and decided to make profit off their kid. Sad. He should’ve stuck with his previous house and said “no thank you, go hustle someone else.”
Just bc he is their kid they should take a bath and have nothing to retire on?? He said he needed a bigger home , they are selling him their bigger home below market, he could have stayed in his little house and built on
I actually think asked his parents to do that since he said his family outgrew the old house and didn’t have enough money for a bigger one, so they sold it to him below market value.
@@UsernameUnkwn21No, they aren't selling it to him. If they were, his name would be on the mortgage. They're just renting it to him. Bad deal all around.
I’m wondering if the parents have a reverse mortgage on this house and didn’t bother telling their daughter and son-in-law this.
Renting a property would be cheaper for this couple.
Dave is being overly dramatic here. If they just get like 4-6 roommates they will be fine.
Can’t have roommates when you have a family wife, etc..
@@f.w.1318 I know, I wasn’t being serious. They’re screwed.
@@enricopallazzo3244 LOL yep, I just saw your profile pic, L Nielsen was a classic, dude was funny as hell.
@@f.w.1318 The best
I chuckled for a good few minutes at this comment lol. Mostly because I could definitely see a tiktok bro recommending this path 😆
John would have asked if the callers Parents are safe
💯
Lmao
“Dude, I know ya’ll made a mess out of this but are your parents safe right now?”
@@bryandelcid4065 Lol
@@bryandelcid4065 “it’s important you get them in touch with a good pastor, uncle, cousin, or a true friend who can walk with them through this…”
Correct me if I’m wrong but the original loan was for 300k+. The parents are locked in at whatever that payment is. So, the mortgage payment could be $2k and the majority of it is going to equity on the $90k remaining.
Dude can’t even explain what kinda situation they have going on here 😆 1:46 Dave’s face cracked me up 😆
Exactly. It's like pulling teeth getting information out of this guy. He just babbles on and on, is super unclear, and I don't think he even knows what he's saying.
What about 3:15 when Dave learns how much savings they got?😣
@@TheSecondWitness I feel sorry for his wife marrying this jerk.
USDA offers $0 down payment mortgages. There’s also programs to help w/ down payment assistance. Find a builder who pays closing costs as well.
In rural areas yes.
It's not necessarily a bad deal for any of the parties involved, it's just that the paperwork is totally lacking and jeopardizes the caller's financial future. Probably should have used lawyers to structure the transfer of ownership and payments to satisfy all the interests on this property.
They can still fix it
Caller: Need your advice.
Show: You're an idiot that has screwed up everything.
Audiance: Yeaa!...I feel better about me!!!
Well, yes, the callers however get valuable advice and sometimes they actually start the process of improving their lives so Is not entirely a "Jerry Springfield" kind of show.
LOL! That's the gig in a nutshell!
Rule of thumb... if you cannot easily explain it to a layman then stop what your doing, take a step back and consider other options. The more complicated and creative it is tells me you most likely can't afford it anyway.
Exactly. If the deal takes more than 10 seconds to explain something is wrong. Step back, turn around, walk away.
Thats an excellent rule of thumb. I'm gonna use that. Thanks!
Haha Awesome!! 🙌🏾🙌🏾. Most of it is them trying to word/phrase it better so it doesn’t sound dumb!
I like this, if you can explain it to a 4yr old in 5 seconds. Then it’s not so simple
$72,000 a year and the wife stays at home? He doesn’t make enough for that lifestyle. Let’s start there. So no wonder they were able to be tricked into taking that mortgage on. They already live in delusion
That's about my salary. My wife stays home with my two boys in So California. $360K mortgage, no car payments, paying down debt, high cost of living and we live quite comfortably. It's all about management.
@@sarahjaynescott545 I didn't force the stay-at-home life on her either. We planned it together long before kids came. That doesn't work for everyone but for us, we feel it's best for our kids. I didn't want my children being raised at a day-care center. With budgets, please don't simply blame the man. It's not a husbands job to do alone. Both partners need to be involved regardless of who the breadwinner is. If the wife isn't an active participant in managing finances then she can't blame the husband when thing go bad.
We live off $70k as a family of 6 and I also am a sahm. It makes no financial sense for me to work when daycare is $1000 more than what I would be making as a teacher. My husband makes $130k but we live off $70k of it. It’s definitely possible but people need to have their priorities right and don’t be afraid of making kids share a room. With me being home with the kids, it gives me time to meal plan, find free/cheap things to do on the weekend, cook daily, clean the home, budget for everything else, etc.
@@eriks442is too! We make it work , well worth it.
@@sarahjaynescott545whaaaaat
If he had the money he could "outgrow" the house anytime he wants but he DOESN'T!
What they "need" and what they can afford are two different things.
They should cut their losses and go rent something cheaper until they raise enough money for another mortgage. The parents can sell their home to someone else
Everyone is missing the point. He got to post all those pictures on Facebook, showing his new big house & how he's living the dream. That's worth going into bankruptcy...right? SMH.
BUT my FRIENDs have a BIG house. My HOUSE is BIGGER than yours! Wife should get part time job/full time job! (To Help)! ! !
This obviously isn't a "disaster" - Dave is very stupid and this is theater. They have safe housing, they are essentially renters, they are paying their parents rent right now. There is no urgency on changing anything.
Just "rent" from the parents until the mortgage is paid off then they "give" it to you and you give them asking price minus £90k in monthly installments. Verbal agreement!
He is getting the house for $340,000.00. Then he is getting the house for $300,000.00. He was making $75,000.00 a year then he is taking home $72,000.00. None of this makes sense.
1/3 of take home is perfectly fine for a mortgage payment. This is only bad because the house isn’t in their name.
Git on da rice n beans yall 😮
Thumbs up if you only watch videos with Dave in them and not the other clowns.
Relax
@@NadeDogg Nope, he’s right
I like Ken Coleman. His daughter Rachel is ok but it's obvious nepotism.
@@Neoquaker1 She hot tho
@@Kaktus965 No she's not.
Uhhh, sell the house? If the parents agreed to owner finance the house then they son/daughter have the right to sell and keep the profits.
And we out grew our 2 year old SUV and we needed a full size new Suburban so while I watch the kids and wife can drive to yoga lol
Why can't the parents sell the house, and kids get more affordable house?
Another stay at home mom. I remember once one of my friend's wife felt their house was too small and wanted a bigger home in a better area. So, my friend went for it. I forget what they were making but the mortgage payments, taxes and insurance were about 40% of their take home income. Then, she wanted a new mini-van to haul the kids around for about $25k. They financed it. There was vacation in Hawaii. Then, there was subtle pressure for him to make more money. When the divorce happened, he was left with a mess of bills and about $800/month to live on. Good thing his new wife makes 200K a year.
Buying things you can't afford. Pressured by parents that are not economically sound.
Generally, subtract one "bedroom" from the count (except for a 1 bedroom, obviously) for a storage room if there is no dedicated storage in the house or on the yard, or even a garage. Suddenly less struggle to find a place to rent for the furniture and equipment.
6 jobs? I am working 3 jobs and barely have any sleep, life, or cook. And I'm struggling like heck.
Meanwhile I’m paying 2K for a 1 bedroom apartment 🙃
Parents should just pay off their mortgage and then provide a private mortgage to the son. So the son pays the parents but can have the house under his name. The problem with this scenario is that the parents are skipping the step of paying off their mortgage first.
You're assuming parents have cash laying around to pay off the house.
The look on Ramseys face at 3:15 said it all. If it's too good to be true, especially within the family it usually is. I'd rather be dirt poor than doing financial business with family members. It always ends up slapping you in the face, and creates a friction within relations. Learn to handles your own stuff and keep family out of your affairs.
Sometimes they can be so dense. You have a $2000 payment because it isn't a $90,000 mortgage. It is a mortgage for much more that has $90,000 left. Just because I pay down my loan that doesn't make the monthly payment go down unless I refinance it back out to 15 or 30 years again.
Never involve your family in anything monetary unless it’s with a lawyer. Your family will screw you as hard as possible because you trust them.
They're making payments on a $300,000 plus house. Parents owe just $90,000 and probably just paid approximately $150,000 plus for the house. Parents could rent it to them, still make a profit and they'd be paying a comfortable amount for rent.
It's a $2000 payment because the payment is based on the price they bought it for, not what is left to pay. It was probably a 250,000 dollar mortgage.
Mom and Dad can give a gift of equity which will cover the Down Payment and closing costs.
Assuming an average appreciation rate for a home assessed today at $320k, with a mortgage balance of $90k, his parents are most likely paying $1,000 or less per month for their mortgage yet charging their son's one income family $2,000 a month. Yikes.
I usually agree with DR but Jade is the voice of reason here. Yes it’s a mess. This caller should move out and rent an apartment. Let the parents pay their own house. Work the baby steps from an apartment. DR is trying to make them stay committed to the bad decision. I say reverse it. I made the mistake of buying the family home from my mom for market value. She said she would come back and help clean it out. News flash, she didn’t. I really couldn’t afford it, so I ended up selling at a loss and having to clean the home. Never gain. Mom laughed all the way to the bank.
She was just nurturing you in her own way 😊
What the heck... it's not that bad. Parents should pay off the house and sign the title over to child with a vendor financing agreement. They don't need a down payment unless the parents want one. This is done all the time without realtors or banks. Typically just a real estate lawyer completes the agreement.
When the parents OWN it, they can. There is a lien holder who owns it now
The mortgage payment is based off the original loan amount. 90k left from whatever the OG loan was.
Of course they can have a $2,000k payment on a mortgage even if the balance is $90k. The minimum loan payment is based on the original terms (price and years) and never changes unless you recast. How does Dave not understand this?
Dave is thinking this, "Call me BEFORE and not AFTER you mess your financial life up."
Good ole dave ramsey giving nonsensical advice. 2k mortgage in todays market is very reasonable. Mortgages that are 25% of take home pay DON'T EXIST. Why won't someone call Dave out on this?
This is so true
Unfortunately, with Biden and congress spending and covid etc. the average is moving closer to 50% when you exclude family help, life insurance, gifts etc. So much salary is getting eaten up by just about everything else that is a monthly bill. These days it cost money just waking up.
When you're in a hole, you keep on digging! Grab a few credit cards and have another kid 😅
Don’t forget to buy a bigger car for the growing family
Hi Dave. I discovered your channel a few days ago, and boy, have I been helped. The five-step process just opened my eyes. I'm from Nairobi Kenya. I need your every dollar app, but it's not available here. How can I access it coz I really need to straighten out my debt situation. Many thanks for the great work that you and your team are doing.
The chances of getting approved to take on the old mortgage are nil. Pull out of the house, go rent a smaller home or apt for a couple of years, pay off your debt, then start building up a new down payment...and don't keep looking for a big house you can't afford...The old "growing out of a house" often means you saw a big house you liked and justified the expense that you really couldn't afford.
But you were foolish to sell your old house considering your 60K debt...
It's not hopeless, you just have to reimagine your dream of home ownership
A seller can do "gift of equity" and that is considered a down payment on the mortgage.
I mean he can just talk to his parents and renegotiate and tell them he just cant afford it. Try and come to a rental peuce agreement or else go rent a small apartment till your out of debt.
Parents conned them.
The parents can gift a portion of their equity to them to purchase the home and they can use that towards their down payment and closing costs
It’s called “gift of equity”
This is the type of call that nobody on the channel can answer even 10% as well as Dave.
Dave didn't listen to most of the call, got all the facts wrong, needed to be corrected multiple times, and gave asinine "advice" and made up a fake "disaster"
Dave's expression at 3:15 says it all.
Why does Dave have to be soo rude. The guy obviously doesn’t know what he’s doing so try and give him some steps to get out of this mess
House will be paid in full in 3ish years. Then they negotiate on the price.
2k mortgage is not a lot AT ALL
Depends on a lot of variables
It is a lot when the household income is $72k. Mortgage payments taking 1/3 of income is not a good situation.
Yeah, $2000 a month out of $6000 total a month is fine. Dave's 25% rule is oblivious to the actual world of property ownership.
It's a lot for me, I'm in Houston and mine is $824 for a 2 bedroom 2 bathroom townhouse
He has 2 kids and a wife 2 support so 2000 is a lot
3:03 I heard the exactly what Dave initially heard about the 60 & 30k. Lol
Mortgage companies DO give 100% loans I can prove it I did one myself. So when Dave says they DONT and yet they do he’s wrong. Oh and before I get attacked I went with a credit union and there’s no PMI.
The wife needs to find a job asap. That income is not for stay at home parenting!
Maybe they, the parents, could remorgage for a longer period?
How do you "outgrow" a house with one kid?
They could have waited until they were out of debt. And yes, should have stayed in their house because they can afford it. Too late.
I don't think they are the kind of people who will ever be out of debt.
Dave is exactly right. The risk is huge. I get they want to own the house but get a mortgage and get your name on the house.
Get the title transfer and the mortgage moved into their name or all they are doing is making the payments for their parents. They're renters.
I could be wrong but based on his income, I don’t think he would qualify for a mortgage on a $300,000 house unless the wife got a job and they both get second jobs. Dave has made many valid points here, some I hadn’t even considered. I think Jade’s idea about renting is probably the only option for the short term until they can increase their income.
Could easily get a gift of equity loan with no down payment from any mortgage company
$2000/month for a mortgage of rent is supper cheap. That's nothing in my area. A one bedroom apartment could rent for more.
I bought a house for 12,000 buckaroos in 1977 and sold it and bought a house for 24,000 in 1980 than built a garage with a apartment above it and moved my mom’s brother in and she said she shouldn’t have to make her brother replace the hot water heater because he’s family. What do you suggest?
The best kind of Ramsey videos!
If you can't afford to gift your children a home. I say don't sale it to them. Looks like wife needs to get an online job.
This is totally off the books, right? This guy has no stake in this house he is paying through the nose for.
I’m 1 minute in, yeah what a mess.
He can buy the property subject to the existing mortgage .
Actually, there are some loans that are no money down like a USDA loan
Not sure 40k equity is worth the trouble. Do they even like the house?
Parents can add him to title with a deed of gift
If the house is worth more than they're asking which is more than the balance why wouldn't the mortgage company approve a zero down loan against a house that is significantly more valuable than the loan amount?
That way he gets the money to pay his parents, they get their payout and can pay off the balance, and he gets the house with his own mortgage and the bank gets a great deal on the house if everything goes belly up.
Man oh man. They owe 6 figures and parents owe a 5 figure. Them making money and what a mess. I owe around $5,000.00 on credit cards and thought I had it bad.
His parents did that to him. Be hard on them!
Just buy a tent and save.
0% chance he can afford a $340K mortgage or even a $268K mortgage on a $72k income. Not happening with today’s interest rates.
what even is wrong with renting from your parents?
especially if you did i right.
here's a few hypotheticals
1) its your childhood family home
a) your parents want to retire and downsize
b) you're either the only heir OR want to buy your birthright from other siblings. (i mean you pay, you own)
c) your folks need less overhead or an income stream
idk, if you rent from them freeing up their money and when they eventually pass its your property anyways.
only thing that I'd see as a problem from renting from a parent is taxes, but even then its called a step up in basis which would mean the property is NOT appreciated with capital gains taxes but rather the new owner/heir has the CURRENT appraisal value. (so that if you sold it, theres no Cap Gain Tax)