“This Guy’s Making This Up As He Goes” 

Dave’s back in his Eastern European drug dealer tracksuit. I dig it! 😂

"Hey Dave, we just got out of debt. What's the best way to get back into debt?"

If you're going to renovate the childhood home, it won't be the childhood home anymore anyways! Tear it down and start over.

In Alaska they call those "moron" houses because you continue adding more on 😅

Dave is right. Trying to retrofit something to a house is incredibly costly, it's better to rebuild from scratch.

I'm not automatically thinking the contractor is being dishonest or sketchy. It's very probable that the contractor knows this is going to be a money pit, and he can't give a good estimate because he knows once they get into this old house it's going to be problem after problem. This is a money pit. And plenty of contractors don't want to take on long jobs that have a high likelihood of being extraordinarily aggravating and endless. This means they have to keep going back and forth with a pissed off customer who doesn't want to pay further expenses, but now everyone's stuck in the middle of this dumbass money pit.

Hire an architect to design the renovations, step by step while maintaining structural integrity, then get 3 bids and design the budget to work within it. I get the feeling the house may have been neglected for decades, be in a serious state of disrepair, thereby making the whole idea infeasible. Need an architect to do an onsite survey to evaluate the structure to start.

Our house was built in 1879 as a small Victorian home. It was extended in the 1930s and again in the 1940s, with Art Deco additions. So, now it is an Art Deco Victorian home. It is a pretzel of a house.

Wow, Dave’s advice is right on. I’ve almost completely redone my house in 6 years. I saved and did the kitchen, then a bathroom, then the 2nd, then the floors, etc. Slowly, smartly it became perfect and paid for.

I work in construction, For a project like this they need an architect that does design and has engineering, preferably one that does project development as well (permits etc) Then do your research on contractors in your area, and do what’s called a closed bid. Where you ask the contractors to bid based off your design work.

tracksuit Dave ain't playing.

When u have a Financial Advice Podcast at 12pm and a Break Dancing competition at 1pm.

It would probably be better to build a new house on another part of the property then demolish the main house. You could then use a lot of the fixtures/details/trim from the old house to put into the new one so you would still have the sentimental elements.

I live in house about 100 years old. Forget using a level or square when doing renovations. And have plenty of drill bits, that old lumber is hard!

My reaction is that the contractor might be using the sky high price as a nice way of saying "You really don't want to do this. And neither do I."

Sounds like a money pit. Unless it has true historic significance, tear it down and build from scratch on the property.

This guy should watch "Money Pit".

Do people know they're calling the Ramsey Show? How do you call Dave and ask if you should get a HELOC?

Great advice. I am in the market and every time we see a home like this it’s a turn off and it always has to drop in price before someone buys it - even in a good school district with land. Take your time to and think it through.

Dave looks great since he joined RUN DMC.

Dave is right on. My friend tried to add addition and her budget was double. They want to add second floor and expand the living area. Was budget 750k and end up spending double…. She told me later it would have been much easier to rebuild. They want to expand basement and … the floor was not even, they need to pour concrete… a lot of headache.

Yo whoever the new outfit designer at Ramsey found the solution. Dave looking like a boss 🙏🏾✝️

:27 seconds dave sneaking a cigar to go with the outfit

I think this contractor is actually pretty accurate in that he can’t give a solid estimate without getting inside the walls to see what’s actually there. Old houses are like that. Could be fine and solid, could be made out of duct tape and chewing gum, you could find a body under the stairwell.

I would've asked about how much land it actually is to see if they could build elsewhere on the property.

Dave, this may be sign of the times. I was trying to convert my existing garage (around 500 sq feet). I got 4 bids and they were all wild! 180k for a renovation project!!! Its nuts. (I will add that I had design drawings created with electrical, plumbing, etc.) These guys are making money hand over fist so they could care less about smaller jobs. We decided to wait and do project when things cool down. But it really makes no sense- they are wanting more than the selling square footage cost for the area. Makes no sense and honestly makes me think we are in for a big economic reset.

When he says a country build it reminds me of the movie the jerk where they rebuild the shack into a bigger shack 😲

This is like when hispanics "hook up" a 97 Honda Civic. At the end of the day, it might look good but it's still a 97 Civic

I don't understand these people. 😂😂😂😂. Your going to call dave & ask permission to barrow money? You know how that ends. Why are you doing it? He's going to say no to any debt. How is that not obvious. I figured that out with one episode.

You can do a lot of work yourself. It takes more time and effort but in the end you’ll save money.

I agree with Dave - at that price, tear it down and build a new home.

Caller: Dave is being polite but he is saying don't do it.

If the land is big enough, can they rent out the homestead and build a new house?

When you have The Ramsey Show at 2 but you're running a 5K right after

I'm sorry, but I think the concept of a house evolving to suit the needs of the family living in it is an AWESOME approach. You need another bedroom? Throw on another bedroom. YES! We get so hung up on resale value and homes fitting into a particular mold and model that we don't leave room for people to enjoy their personal property in the way they want and need. Who cares if this new bedroom goes randomly on the end of a living room or kitchen or whatever, if it's what the family living in it will be happy with?

AND if this is your first experience the planning is doubly needed.

How can you be on Baby Step 6-7 and still ask if a HELOC is best?

'country built' = the winchester mansion

I would build a new house. This is a mess.

Totally agree $100,000 off is not a budget. Hire a contractor who can break down the project into smaller chunks

Been listening to Dave for a long time. I'm surprised every time by callers that can have such a high income, but still struggle with money and other issues.

Putting 250k on currently 250k valued home without knowing it's projected value after renovations is absolutely ridiculous. C'mon people

Why buy a family house if it needs that much work?

What is the square footage of the home? What’s the neighborhood like?

Yup took two years rebuild my ol farm house an it's way more work than just building bran new

If the property is as good as he says they should look at building a new, second, house on the property as the primary dwelling and keep the old one as a utility building or whatever other use they might have for it (or even possibly subdividing the property).

what's the value when repairs are complete?

$25,000 to demolish the house, get a decent RV/camper to park near by and build new for that price

Dave looking like the final boss of the Debt Free Mafia.

Yes, get an architect, not a general contractor who thinks he's one.

I feel like I feel like it's a little glib to say that you as the customer get to decide how and in what intervals large construction jobs get done. Number one, the decent contractors might simply not be interested in taking on the work in chunks like that. Sure, the 70k bit might be worth their time, but the 10k part? Hard pass. It's just the world we live in -- there's a dire shortage of good construction workers, so it's just a reality that we're constrained by what they're willing to do. Number two, even if you DO have a contractor willing to take on piecemeal work like that, there are costs associated with starting up and winding down jobs. If your piecemeal job entails him coming and going half a dozen times, that's adding thousands of dollars to the total cost of the work. At that point -- when there are actual, material costs in refusing debt -- it becomes pretty prudent to consider the HELOC. Say the piecemeal work will cost $10,000 extra when all is said and done. If the HELOC's total interest is less than that when you aggressively pay it off in one or two years, then just take the debt. Or just tolerate the bad living conditions until you can afford the lump sum work if you really can't allow yourself to incur debt.

Great advice! This project needs an architect's advice and plans or it will be off scale & off style ending up looking like crap and lacking in function.

Folding Oaks is a great, Texas-based designer who can get you reputable builders. This plan ain't going to work without it.

Going into a first mortgage on this is no biggie, but why get involved in this old house that needs to be so drastically expanded anyway?

If it’s a good sized piece of property, it’s smarter to just build a new house on the land. If you must keep the old house, rent it out or something.

Great advice. BTW, Jade is beautiful

Dave’s on point with his response!

If you are doing a major renovation that involves structure, you need to get a set of plans drawn up by an architect. Spending a few hundred dollars up front can save you thousands in the long run. Sounds like the reason the contractor cannot give a good price is that the caller cannot give a defined scope of work. Figure out what you want done, get an architect to put it on paper, and then get at least three bids. Due to the Biden inflation, the cost of building and renovating has gone through the roof. I recently got a quote for a simple room addition on one of my houses and it was about triple what I expected. Needless to say, those plans got canned very quickly.

What’s the name of the book? He said “step 7”

😆 Dave is a contractor now 😆

Dave We are in debt for 23,000,000 for a house we bought, and 12,000,000 for the cars . DAVE: Whats yall household income?

Look yall need to git on dem rice n beens😂😂😂😂

Just here for the tracksuit comments 😂

Get estimats from at least three contractors, not just one.

Show us your shoes, Dave! I just know you're wearing the white ADIDAS with the blue stripes and no shoe laces.

He needs to talk to multiple contractors, too. Don't do that big a job without comparing numbers and getting bids. And yes, sometime needs p have done up architectural drawings so everyone is in the same page about what this thing is going to look like, etc. Do the planning on the front end, not halfway through.

He's in Dallas? I can't imagine where the house is that would be worth $200,000 with land. Bet his neighbors are a mix right now, some have been torn down and new builds or the old houses are about the same. He needs to think about eventual resell, especially Dallas.

this contractor is planning to buy a new 100 k truck with this build lol

I think the guy should build a new house on three land, or a complete extension, instead of the hodge podge Dave is worried he will do

"You can't make this shit up." KS

Architect is a good idea. If it has historic value needs good design. If it’s a shack then knock it down. I have seen good redoes on shacks though.

Why do slavs squat?

When you love something you will always over pay

Hi Dave, I have the following question and hope you can answer it. My home mortgage is 480k at 2% interest rate. We have emergency fund, 401k setup, 529 getting saved monthly. Any extra savings that we get should we repay the home loan which is at such a low interest or should we save in mutual funds. My husband and I have a debate on this and unable to decide. Would appreciate your advice and reasoning behind your advice.

Lol for 200k he can build another home in the same property

Taking out a HELOC is like putting your house keys on the roulette wheel

Making 200k with no debt but can’t save up for a home renovation, hmmmm something isn’t adding up.

Free Game

Split the lot, sell the home for the "$250K" then and build a new home on the land for $350 to $450K and have something actually worth what you spend or more.

I’m thinking Dave is a fan of Breakin and Beat Street.

Using emotion to dictate finances is a bad idea. I'd be in favor of saving as much from the original home (woodwork, doors, cabinets, lighting fixtures, et al) that is recognizable as 'childhood home'. Level the house and build new, putting those elements back into the new house. You'll never make a silk purse out of a sow's ear.

for that price he should just build a 2nd home on the land. i wish they would have asked how much land he had and offered that as an option. if this is truly a multi generational farm/homestead you're going to need more than 1 house

Someone pleae do an AI Ramsey doing the slav squat

I'm favoured, $60K every 2weeks! I can now give back to the locals in my community and also support God's work and the church. God bless America❤❤❤

Love your show Dave

Dave’s financial advise doesn’t jive with construction practice. To piecemeal it, they will pay way more for the GC to stay involved, trades will charge more for multiple trips and deprioritize the small jobs, more coordination of the work and rework for sequencing, overall will take far longer and cost more for less quality work. Bad idea for everyone involved. Contractor’s advise was right. If that’s what the pro recommends - listen. And yes, come up with a complete design, agree on the price to do the work with at least 10% contingency and / or allowances for additional items that come up, and factor for cost escalation if the project doesn’t start within a few months. If it’s just cosmetic upgrades they could do themselves, room by room, that’s a different story and Dave could be right. This sounded like a major gut and rebuild.

Dave isn't wrong - but doing it over time will probably be very difficult. It would be hard to get a contractor who can come in, do $20,000 worth of work, then wait 6 months for you to save another $20,000, do the work and then wait another 6 months etc. Also I am guessing that the total cost would end up larger than if you had just done the entire project at one time. But Dave is right that you shouldn't do the renovations unless you have the money saved up for it.

i would just want to move at that point . Daves plan to do it in pieces will mean your home is constantly under renovations maybe for years , always having contractors around making noise invading your privacy its just not worth it

Wow, big leaps of assumptions by Dave without asking more questions… Didn’t hear anyone say what will the renovated home end up being worth relative to the neighborhood. We live in a neighborhood where people regularly spend $150K to renovate/expand a $250-300K home and it pays off. The other key question is - what will it cost to buy a home with similar attributes to the one they will end up with. But certainly, it sounds like that construction contract needs to be tightened up to reduce the variability. Surprises can be covered by clauses in the contract.

Definitely need to go with chunks. A crazy guy in college was so off the rails one weekend night and he told us the next day that he blew chunks. We said well that's not that crazy. He replied that chunks was his dog's name. 😮

Dave looks like Nice Guy Eddie from Reservoir Dogs.

Oh no he didn't! Asking Dave about taking out a HELOC! Cue the Dave rant.

Sounds to me like they're planning on building a Frankenstein's Monster house. It may have been better to level the house and rebuild from the ground up.

need to sell and go buy a new $500k house. the sentimental stuff is for the birds. the reason it's so high to repair is cos it's so raggedy. better be happy modern contractors even want to touch it.

Dave is right. I live in So Cal and in Rosemead/San Gabriel there is a huge asian population. When you drive through the neighborhoods you will see where there used to be tiny starter homes on tiny lots they built awful gaudy looking mansions that look extremely out of place. Seems insane to me but apparently enough of them liked it that it became a thing. Definitely ruined the neighborhood imo.

Just going to be more of the herd!

“Should I get a HELO…” “NO!”

He’s just calling to brag.

Gopnik Dave 😀

The changes that they have to make? He has no clue of what he needs. We have done our house using income on a room by room basis. If we run into a structural issue, then you deal with it, if we find it. But we never start with a "we need this structural issue fixed in order to make an open concept" for example. When We purchased our house, the structure was already in tact. That has happened for each of the 4 homes that we have fixed.