Build A Life That Doesn’t Depend On Debt

Dave Ramsey (0:02)

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Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the FAIRWINDS Credit Union studio, this is The Ramsey Show. George Kamel, number one bestselling author, Ramsey personality, is my co-host today. James is in Springfield, Missouri. Hey, James, how are you?

SPEAKER_2 (0:31)

I'm doing well, sir. Thank you.

Dave Ramsey (0:33)

Sure. What's up?

SPEAKER_2 (0:35)

I have, I guess, I own two houses, and I'm wondering if I need to go bankrupt or let one of them go in foreclosure. I've been paying both mortgages since my children, who were my tenants, moved out in late July, and I'm running out of, I'm running out of my savings.

Dave Ramsey (1:01)

Okay. So the house that they moved out of, what is it worth?

SPEAKER_2 (1:07)

It is right around 400

Dave Ramsey (1:10)

And what do you own it?

SPEAKER_2 (1:13)

260 with a HELOC of 100,000.

Dave Ramsey (1:18)

Okay. So is it for sale?

SPEAKER_2 (1:20)

It is for sale. It's been for sale since July.

Dave Ramsey (1:25)

Why is it not sold?

SPEAKER_2 (1:28)

I think the market, my wife and I combined families about seven years ago, I converted the carport into a garage, which seems to be in the carport into a room, so that all of our eight children could live in one house. And that seems to be the biggest gripe from the buyers right now, that there is no garage in Phoenix, Arizona.

Dave Ramsey (1:55)

The house is in Phoenix?

SPEAKER_2 (1:58)

Yes, sir.

Dave Ramsey (1:59)

All right.

Ouch. Okay. Yeah, I mean, I'm going to keep dropping the price, and who has the heat lock, the local bank in Missouri or the local bank in Phoenix?

SPEAKER_2 (2:12)

In Phoenix, Bank of America.

Dave Ramsey (2:14)

Oh, Lord Jesus. Okay. You're dealing with the evil empire. All right.

Well, what I would do is have you got, what's your real estate agent like?

SPEAKER_2 (2:31)

He is, I mean, he's okay.

He was a high school friend. Wrong answer.

Dave Ramsey (2:37)

Fire him.

SPEAKER_2 (2:40)

Okay.

Dave Ramsey (2:40)

He's okay. He was a high school friend is not how we pick a real estate agent when we're standing over a fire and they're getting ready to light it.

SPEAKER_2 (2:49)

Yes.

Dave Ramsey (2:50)

So you need a high octane, high protein pro. Go to ramsysolutions.com and click on Ramsey trusted for a good real estate agent and get an offer. And if the offer is less than you owe, take the offer to Bank of America.

That's called a short sale. And a good agent can show you how to do that. But if you don't have them, I'm guessing you don't, how much cash do you have in the savings?

SPEAKER_2 (3:18)

It's depleted after my...

Dave Ramsey (3:20)

I know, how much cash do you have in the savings?

Okay, not enough to help with this. Okay. All right.

George Kamel (3:27)

What's your income?

SPEAKER_2 (3:30)

I'm, since January, we knew that we were gonna be letting the kids leave the house. I got a second job. So I make good money, 6,900 for my primary source of income and roughly $2,000 a month from my second job.

George Kamel (3:48)

Okay. And so that, you know, 8,900 bucks is not enough to cover all the bills and both mortgages right now?

Dave Ramsey (3:54)

Buying your kids a house to live in is causing you to face bankruptcy. I want everybody to hear that out there, okay?

SPEAKER_2 (4:01)

Yes, sir.

Dave Ramsey (4:02)

Yeah, next time one of you call in here wanting to buy your kid a house to live in, I'm going to yell at you because of James, okay? And people like James that I've talked to for the last 30 years that do this stuff. Oh my gosh, I'm so sorry. You're not bankrupt. You might get foreclosed on.

Is your primary residence up for sale?

SPEAKER_2 (4:22)

My primary residence we live in in Missouri.

Dave Ramsey (4:26)

That's your primary residence.

SPEAKER_2 (4:27)

It's not up for sale. We live in it.

Dave Ramsey (4:29)

Yeah. What do you owe on it?

SPEAKER_2 (4:32)

We just moved here from Arizona, so $385 I owe on it. It's probably worth $425.

Dave Ramsey (4:39)

Okay. All right. And you can pay that payment pretty easy if you stop paying the other one, right?

SPEAKER_2 (4:44)

Yes, sir. Yeah.

Dave Ramsey (4:45)

Yeah. Okay. So here's your number one, you take care of food. Number two, lights and water in Missouri.