Take-Aways from this Video:
Dave Ramsey has done more for America’s financial position than any other person or organization in the world. In this video He talks with a caller to his show that wants to buy a house.
House fever is extremely difficult to extinguish, and can cause people to act irrationally, make stupid financial decisions, and get themselves stuck for a very long time.
If you’ve gotten to the point where you’ve decided to buy a house, we highly recommend taking time to take a “cold shower,” and make sure you’re not comparing yourselves to the “joneses”.
So many people start looking at homes, and spend 101% of their approved mortgage amount, while convincing themselves that they’ll cut back in spending in order to justify their purchase. We encourage home ownership, but we also know the trap we get in as Americans by telling ourselves a story that’s not really true.
What do we tell ourselves about home ownership that’s not true and gets us into trouble?
- That we’ll reduce our spending in order to make the house work.
- Our income will go up
- We can do without some things in exchange for a nicer home
- We can do with a lower down payment, in leiu of having a nicer house
- We tell ourselves we can handle a payment, rather than being honest about the total mortgage amount
If you’ve found yourself hunting a house and feeling like you’ve got “new house fever,” then take some time to get some perspective, have coffee with some mentors that you have, get perspective from other wise people, and carefully pray or think about what you need versus what you can afford.