Although I am just now taking interest in home ownership and taking the time to educate myself, this message delivered by Suze delivers more than just information, she advocates for folks out there much as a nurse advocates for a patient. This message echoes much empowerment for the individual consumer. I'm glad that she is frank and realistic about the reality of the power of money (for which we give it).
Until you have fully paid your "home", you truly cannot call it your own. You still don't believe me? Don't pay for a month, the real owner will be calling.
camaroman101 +camaroman101 yeahhh, it truly sux, so is there another Country like Canada for example that property taxes don't exist? I'm Native American Indian, the Govt. Knows it but, I don't hear them calling me to get AIB benefits. (American Indian Benefits) Cause they treat ALL Americans like we are a Communist Country! This isn't the Land of the Free... In a DREAM World of Fantasy maybe!
I'm Native American Indian & I don't hear our Government calling us ( who don't receive AIB benefits) I'd have to live on the Reservation. (Which I wouldn't mind!) To say as an American I am Proud to be an American, how? There is no way to truly Own Anything according to the American rules that were just discussed. Property taxes? And Even after the Home has been paid off? We are under a Communist Country! Govt. Govt. Govt.! Most just live Subliminal about it. We are NOT FREE. We have just been Conditioned to think So!
even if you pay off your home in full, the feds will always technically own it due you being your "straw man or woman". your best born as a corporate entity, not a sovereign American national.
People can be so stupid sometimes. They only think about the present, not the future. Do yourself a favor and don't buy a house unless you can put 20% down and have at least a three month emergency fund incase you lose your job as well as $10,000 in savings incase something unexpected comes up.
I purchased with a conventional 3% down...I had 8 months emergency fund before I purchased instead of adding cash. It was new construction with tons of warranties..interest rates are 2.85%. I don’t regret buying...do I have to pay PMI? Yea I do but at 32 with kids that need a descent school, I don’t care. You can make extra payments and do improvements to get 20% equity quicker.
I bought a new house four years ago, and after comparing all costs of homeownership to the cost of renting a one bedroom apartment, it only cost slightly more to live in a quality built three bedroom house than a poorly built one bedroom apartment. You need to be financially responsible, but you get so much more for your money buying a house than renting an apartment. Buying a house will help you realize just how overpriced apartments are, even the cheap ones.
A lot of landlords (especially where I live) don't even care about the upkeep on their properties. Why pay all that rent money when the landlord doesn't even do anything?
My condo pays off in a few years when I retire. I'm glad I bought a home because in a few years I won't have the big monthly house pmt. If I had stayed a renter I would have to continue paying a big chunk of money every month and then retire later.
I bought a bank foreclosed home with 5% down with a conventional 30 year mortgage (660 credit score). It appraised for 30% equity 2 years later and dropped PMI. If I followed Suze's advice I would be living in a trailer trying to save money while making other people profit off of my living situation. Buy a good deal as soon as you can and pay it down till the PMI drops off. Each year you wait the real estate market increases 3-5% on average. For a $150K home that means an additional $4.5K - $7.5K each year. You could be saving your whole life and never get that magic 20% down payment. Boo to Suze!!!
Agreed. I'd rather just pay the PMI and enjoy my lawn than wonder when my rent will go up again. Of all the things that stress me out, the mortgage hasn't been one of them.
Darn Suzie many would have had over twenty percent now in just two years. You do have some good Ideas, but sometimes a bit of risk is ok as it motivates. My mom would have never had a house paid for if she would not have had government plan. It motivated her and house was paid for in 15 yrs
Rent for a one bedroom apartment in houston in a decent area is now $900-1000/month. The apartment complex are only doing 1 year leases. If you need 6 months, then you pay market rate. This is insane. A new house with PMI and taxes included is around $1200/month. Why rent?
I am with you. If that's what you are paying anyway, then what does it matter? Get a good home warranty, trust in God and get under what you can afford. My mortgage including PMI, taxes, and insurance is only $508... How can you beat that. My house only cost $75,000. I can easily pay that off well before 30 years... just saying.
The problem is generations of non equity building. As long as the buyer purchases a low cost home he is tricked into building equity without thinking about it. If he puts a portion of his income to savings that he does not see then he is tricked into building equity and to survive small storms. Over the course of time he will without thinking have assets for his future family
I like the fact that Suze is willing to firmly go against the establishment chorus and send the message that only people who can afford a house should buy one. The only point I disagree with is that spurring a housing bubble does not create real wealth, it only temporarily juices the economy based on debt fueled spending. Once the market inevitably crashes and the debt comes due this is the pain we are in now.
We bought our home one month after this was uploaded (I was 22 at the time). We just refinanced into an even lower rate, got rid of our PMI because our house has gained so much value, and will pay off our house almost a year earlier. When it is all said and done, we'll save $30k on our mortgage and we'll have an immediate savings of roughly $260/month. We purposely bought a large enough house that we'll never have to move, so we shouldn't have any problem paying it off by the time I'm 50, at the latest. If we do choose to move in the future it will only be because we could also profit from renting the house.
Is this only for people who carry interest? I’m wanting to pay it off, so I can be debt free 2020. I’m not sure if keeping the mortgage going looks favorably or not.
Homeownership has become the American nighmare. Any subprime lending situation is and has proved disastrous. Equal housing laws have turned me into a renter from a homeowner. Just because there are government and financial institutions that will make any high school dropout making $12.50 an hour a home owner does not mean that this is a succesful program for the economy. Also Equal Housing laws along with the huge subprime community allow the irrespnsible and their usual social ineptitude to move in right next to me. This is right after I have worked my way through college, risen above the tatoo generation, and end up living in what I noe consider the wrong side of the tracks even though I have pursued the dream "conventionally". All of this thanks to civil rights legislation and greedy banking. Now I just rent so I can move when the "hood" starts to stink. But, we should save and invest the money, if you can, that you would have paid in upkeep, taxes, etc and empower yourself against bad goverment, predatory financial institutions and the idiots that buy into it. It is not housing that is upside down, America itself is.
Hi Brandon, More on this later but the 20 percent is the rub. The traditional viewpoint is that being able to save up the down payment, no matter how long it takes, is an initial measure of a person's abiilty to be responsble enough to even enter a mortgage relationship. This 20 percent rationale tends to eliminate the subprime predators and scandals that the bankers took bets on to fail, debt swapping and the like. So, no time table, but if you use all the subprime "helpers" you will be in a world of mortgage hell that will keep you way deep in the system at a tremendous disadvantage. I know nothing about minorities, or low income types in general, in Maine, but where I live, VA., any jerk with a subprime loan can move next door to you and expose you to total culture shock. I am sure this is not always the case with those who go the subprime route, but without all the non conventional finance avenues of late, I would have either no neighbors or much better ones now that all the old established families have died out.. I do feel we all need a break in life but enough is enough. My answer to your timetable is to rent as cheap as possible while focusing on the down payment for a conventional loan no matter how many jobs you have to work to get there. At my stage in life (age 58) and having owned many homes, I would rather rent and be financailly liquid so I can move as my local incompetent government is taxing us out of our homes to the point where only misinformed dreamers and suckers, in the subprime realm, are buying in. The rest like me, are cashing out, moving on and buying small. Maine sounds good! More later and thank again for your reply.
She only yells in broad generalizations. I bought my house for $170k on a 15 year mortgage with $0 dollars down. She would have screamed at me for being an idiot. But I had a plan, added extra $ each month had the entire thing paid off in 8 years. If I had waited until I had 20% I would have missed the market. So don’t be stupid, but not everyone has to live by these rules.
And I'll bet that all eight of those years you were wishin a prayin a hopin that the roof wouldn't go that the furnace wouldn't blow up and that you wouldn't need a new washer and dryer anytime soon all because why? You couldn't afford it to begin with.
Suzy Orman is so Wishy Washy!! In another videos she reccomends buying a home and now it's not a good idea in this video. she says in another video not to budget then tells people to watch where their money goes.
You are so correct. I am buying a $210K brand new home for the first time at age 60. I inherited money and I was able to put 20 percent down. I plan on working and so does my husband until age 70. I still have a 15 year old son at home. We have a 20 year mortgage and as long as we live to pay it off at 80. Both my parents lived until 87 and 88. My husbands parents are still alive at ages 85 and 84.I am sure she wouldn't agree with me. We had the cash for moving expense new things for out home including appliances and furniture. Our rental was 1,600 a month. It was a brand new building 4 years ago.. It had a leak and was constantly having upper respiratory infections. It had mold in the laundry room. We were are the mercy of cheap appliances that were always breaking down in our luxury apartment. We also had to pay for our water too. If I lived the rest of my life renting I would have nothing in my old age. If we have to sell ahead of time in a growing area I will have the money I put into it.
I'd rather take my chances buying a home than renting and being at the mercy and whims of a landlord, who may not even be making the mortgage payments on the property. I don't believe a down payment is needed at all, if a person can get a 2nd mortgage and get the down payment covered with a loan. Pay the PMI insurance - big deal. You do need a decent credit score though, and have common sense and good control of your money. But don't be afraid to buy a home because of lack of down payment or lack of a big emergency fund. You need some cash on hand to do the home buying process for earnest money, home inspections, and other fees related to buying that the 2nd mortgage won't cover.
She make a good point. When you own a home having extra money for repairs and putting a large down payment will reduce your mortgage in the long run. SA is telling future home owners to prepare for expenses that come from owing your own home.
Big Talk From People With Money. Save a 8 month money reserve ? 6 months OK, If possible. There are many who own homes who did not put down 20% or have a cash reserve. I feel, IT'S BETTER TO HAVE HAD AND LOST, THAN NOT TO HAVE HAD AT ALL. If you feel you can get a house. Don't wait because people tells you it's not a good idea. Learn from your own mistakes when they come.
+TheNutzandBoltz That is her TV persona / personality. That is what makes her interesting. If she had a bland boring personality, she would not be where she is. It is all entertainment.
Chomsky as a bland and boring personality and he's got a big enough following. I think americans follow the wrong people, like Miley Cyrus, Gangsta RAp celebs like Ice Cube... As along as there making money and havin a "cult" (deranged people) following, the banksters are there to bail them out, they have no morals
you will never truly own anything as long as property taxes are applied your house can be paid off and you dont pay property taxes they will sell your home so who does your home really belong to ? the goverment it does allow you to borrow more money and get deeper in debt so we are all renting
The only reason why suzan is discouraging people not to buy property unless they hav 20% to put down is because she probably have so many rental property across america or have huge amount of money invested in REITS and she want her rentals to stay occupied she is protecting her investments. I would suggest save money for rainy day and take advantage of fha loan and go buy your house instead of paying rent. Yes owning a home is long term commitment , but dont let this lady discourage you, why make your landlord richer.
FHA in January 2012 charged our daughter PMI even though she put a little more than 20% down and paid her own closing costs. After three years they said the PMI will come off....we will see soon! She was told because of all the bad investments FHA did, people who put even 20% down have to pay it.
Kristin Niemeyer It was 2011 when she got the FHA loan, she was only 22 years old with little credit. And our daughter corrected us, it's five years her PMI will come off even though a little over 20% was put down plus closing costs. The bank said, FHA has to make up for all the bad loans...that is one of the ways they are doing it. She eleven months and the PMI charge comes off.
Hey, I agree with you are saying, but home owner ship is becoming out of reach for the majority of Ameicans expect the super wealthy like yourself. You really need to stop just for moment and thank about people outside your personal circle who can not afford 20 percent down. FHA gives people hope that one day you can own a home before you check of here. With the rate of inflating going up 20 pecent will equal 5 percent by time most people save their 20 percent especially in California.
20% of a home is not hard to save. If a home is 100k than u only need 20k for a down payment. It's been 6 years since 7 wrote this comment, hopefully u bought a home with 20% down on it
