How will I ever be able to buy a home?

Ralph Estep
00:00:00

Are you feeling discouraged every time you see those rising home prices? Does it seem like the dream of homeownership is slipping further away with each passing day? Well, let me tell you, you're not alone in this struggle.

And today I'm going to share how biblical wisdom and practical financial strategies can make your dream of homeownership a reality. Stay tuned as we address the question that's weighing heavily on many hearts. And that's this. How will I ever be able to buy a home?

Podcast Announcer
00:00:28

In a world where crushing debt keeps you trapped, where living paycheck to paycheck has become your new normal, and where the dream of retirement seems impossibly out of reach, there's hope. Join financial evangelist Ralph Estep Jr. A man who's walked through the fire of financial failure and emerged stronger on the other side.

Welcome to Ask Ralph, the show where real world experience meets biblical truth. To break the bondage of financial despair.

To get ready to take control of your money, break free from the financial stress and align your resources with God's purpose for your life. This is Ask Ralph with Ralph Estep Jr.

Ralph Estep
00:01:10

Well, welcome to the show today on this snowy day here in Delaware. I don't know if you can see it behind me, but the snow is coming down pretty good right now.

And I am truly blessed to have you here as we explore another important topic that intersects faith and finance. Now you might be saying, Ralph, what does home ownership have to do with faith and finance?

Well, clearly you can understand the finance part, but, but I'm going to talk about the faith part as well today. Now, yesterday we had a great show and that was whether Christians should invest in the stock market.

So I'm going to encourage you to check it out if you missed it. And I talked about how biblical principles can guide our investment decisions and help us build long term wealth that aligns with our faith.

And you know, you can get all of our shows@ askralph.com. well, let's get to our listener question today, and it comes from Kiley. And Kiley writes this.

She says, dear Ralph, I've been saving for a home for three years now, but it feels like I'm getting nowhere. Every time I think I'm getting close to having enough for a down payment, home prices jump again. I am starting to lose hope.

As a Christian, I want to have a stable home where I can raise my family and serve God. But the financial burden seems overwhelming. How can I make this dream a reality while staying true to my faith?

Well, Kiley, thank you for your question and it is a question I am seeing more and more of. I belong to a lot of Facebook groups and even the, the Ask Ralph Insiders group. And I'm seeing that question come up.

And I get it, Kiley, you're trying to balance your desire to buy a home while remaining strong in your faith. And listen, it's a common concern. Like I see it, I see this constantly. And that is not an easy thing to do right now.

We see home prices are rising, we see interest rates are coming up a little bit as well. And I get it. You want to have that stability of being a homeowner and that's awesome.

And I hope today's show and I'm, and I'm sure if you listen to what I have to say today will help you along that path. Remember, if you've got a financial or a fake decision to make, just like Kiley, you can always go to askralph.com and click on the search button.

I got almost 700 episodes of material out there, from videos and audio to blog posts. So before you make a big decision, go check it out and see if I've already done a show about it.

Listen, if I haven't done a show about it, here's my challenge for you. Go to justaskralph.com and share that question with me. Or the other thing you can do is join me every Tuesday night at 7:00pm Eastern Time.

That's tomorrow night, 7:00pm you can go to askralphpodcast.com/live. That's the home of our weekly live show. And you can get your questions answered right there live.

Well, Kiley, I thought about today's Bible verse and I said, what would be a great one to use? And, and I thought about it. You know, the key today, the key to what you're talking about is diligence and it's about planning.

And that's exactly what you're, exactly what you're doing, Kiley. You're trying to be diligent, you're trying to plan. You want to buy that house.

And I came up with a great verse and this is a verse I've used routinely on the show. And it says this, it's from Proverbs 21:5. It says the plans of the diligent lead to profit, surely as haste leads to poverty.

If you think about that for a second, this verse perfectly captures the essence of that home buying journey. And the key takeaway for me, it's all about not being hasty. So today's gratitude statement, listen, this is what I've got today.

Today I'M grateful for this verse because it reminds us that God honors disciplined planning and patient persistence. You see, it's not just about the destination of homeownership. If that was the key, that would be simple.

But it's about the character we build along the journey. And Kiley, I'm sure you're feeling the stress of that and the patience that's needed. And I know you're feeling that you're building that character.

So I want to praise you for that. I want to praise you for your persistence. So let me get started and share a path forward for you today. Well, let's get started today.

I thought I would tell you a story that comes from my credit union days and it's about when I created a first time buyers program because I saw a need out there. I want to introduce you to Riley. Now, that's not Kiley. Kiley was today's person that sent in their question.

But Riley is a person that I met way back in credit union days. And she was a single mother of three children. Those kids were ages 6, 9 and 11. She was a teaching assistant at a local elementary school.

And her and her husband had a great marriage. They had had these three kids, and then all of a sudden one day her husband Mike, he was killed in a construction site accident.

And that was just devastating to Riley, was devastating to their three children. And at the time they were renting a home. And Riley was determined at some point in her life to buy a home. She was resilient.

She had gotten through this situation with losing her husband. She was a widower, raising three kids on her own, and she had excellent payment history.

Besides these challenges with her lifestyle, raising three daughters and trying to get through this tough time of losing her husband. And she shared with me back then, she said, ralph, I've moved four times in two years because our neighborhoods wasn't safe.

And they keep on raising our rent. And, you know, she struck a chord with me because as I've shared on the show before, my mom was a single mom as well.

And it shaped my perspective on, on security and shaped my perspective on housing security and finances because I had witnessed firsthand how traditional lending barriers affect families. They just do. Like, Riley had all the checks, but she just didn't have that money for that down payment.

She didn't have that money ready to go for closing. And so I was sitting at my desk one day at the credit union and I was thinking about the experience from my own mother.

And it made me develop what I called a creative in an innovative lending solution because we needed to move beyond those conventional metrics, because those conventional metrics just don't capture the full picture of credit worthiness. And I remember Riley came in and sat in my office one day. She was working with one of our loan officers.

And the loan officer said, you know what, I want you to go over and meet Ralph.

So she came into my office, she sat down, and first thing Riley said to me, she says, ralph, I want to tell you about what my daughter said to me a couple days ago. And let me just tell you what she said rocked me. This is Riley talking.

Her daughter Emma said, mom, will I ever have my own bedroom like my friends at school? And I could just see the emotion on Riley's face.

And it touched me as well, because here was a mother that was determined to provide stability for her children. They had lost their father and there's nothing she could do about that. But she wanted to give them stability.

She wanted to give them a home that they could call their own.

And listen, being a single mom raising three kids and trying to save money for a down payment while paying high rent, it put Riley in this constant state of feeling trapped in a cycle of constant moves. And my loan officer and I, we talked about it for a while, and I said to Riley, I said, let me see what I can do.

Let's see what we can put together here at the credit union.

And so once Riley had left, I sat down with the CEO of the credit union, a couple other people in the lending department, and I said, we need to do something for people like this. We need to have our hearts in the right place. We need to make wise financial decisions. But there's something we can do to help people.

And so we created a program for single parents who had steady income. And the coolest thing about this program was it required zero money for down payment.

And, and here's the kicker, because a lot of people can save, you know, 5% down or 3% down. I'll talk about some of the government mortgage processes later.

But we also finance the closing costs because a lot of people don't realize this, but when you go to buy a home, those closing costs could be as much as 10% of the purchase price. And with this program, we were going to focus on payment history rather than in those traditional metrics.

We weren't going to worry about that 10% or that 20% down payment. We weren't going to worry about those front ratios and those rear ratios. And I've done shows about mortgage process and you can go check those out.

I'll put some links in the show notes. The other thing we were going to add to this was mandatory homebuyer education because we wanted people to have long term success.

And then we structured these monthly payments and in most cases they were less than typical rent. And I said, you know what? This is the program that we can use to ride. We put it together and let me tell you what this did.

So for Riley, I had my loan officer give her a call and she said to her, she said, listen, we've got a way to help you. Fast forward a couple months and Riley bought a three bedroom ranch home in a safe neighborhood.

And her daughter Emma had her own bedroom and her children had their own space. They had a stable school situation for all three of her kids. And listen to this one.

Her monthly mortgage payment, even when we financed 110% of the purchase price, was less than what she was paying in rent. And here's the best part. Every time she made a payment, she was building up equity instead of throwing away money in rent.

And I remember her saying to me one time, she said, ralph, because she came to visit me frequently because we had a good relationship there at the credit union. And she said to me, she says, ralph, I don't know if you realize this, but you just created the first step towards me having generational wealth.

Because the equity I built up in this house I can now pass down to one of my daughters. Well, let me just tell you about settlement day. So she picked out the house.

She went, she went and got that ranch house and she shared with me afterwards. She said, ralph, she said, you don't realize how emotional that was.

When I was signing those final papers, she said the attorney must have thought I was crazy. She said, the tears were just running down my face, it was getting all over the documents. And she said they hand me those keys.

And she said I ran out that lawyer's office, I picked up my kids at school, we went right to the new house. And she said my kids were jumping up and down. They were running up and down through the halls of the house.

And she says, you don't understand the excitement. You don't understand what you've done for us. And I didn't do anything spectacular. Riley was a good credit risk.

The house was it appraised for the right value. But the transformation was remarkable because she was transformed from being a renter to a homeowner.

And I could see that sense of accomplishment and security. And it really did begin a new chapter for her family.

She actually invited me back a few weeks later and I had dinner with her and her three daughters. And let me just tell you, these people were really loving this. And just think about it. It wasn't just Riley that was affected by this.

There were multiple families helped through the program at our credit union. We just looked for people with an excellent repayment history. That was the key to the whole thing. And what did I learn from this?

I learned that there's. There's. Lending can be responsible and still be innovative. You can do both. And now there are a lot of financial institutions that do this.

And what it really does is it shows the importance of looking beyond traditional metrics because people aren't measured by their credit score. I just did a show about that a couple weeks ago. You're not measured by your credit score. People make mistakes. I've made mistakes.

But if you be persistent and stay at it. And that's what we're talking about today. And now that I'm sitting here thinking about that, I think about my childhood experience.

And I was fortunate. My mom was a single mom, but my dad had bought her a home and it was our family home. But I remember it wasn't easy for my mom.

And so it was so important to me when I was working back at the credit union.

Even today in my practice that I do now, I want to give people a chance because I see how just one program, there's just one of the things we did when I was at the credit union, how it transformed lives. And I don't think financial institutions get it.

That's why I did a show a couple of weeks ago about credit unions, because I think credit unions actually do get it. It's all about building the community. Because see, here's the thing, and this is what businesses don't seem to get.

You can have business success and have a positive social impact. So that's what I'm saying. You know, there are countless other stories like Riley. There's innovative ways to make this happen.

Well, let me tell you about another story. This one's about 10 years ago. I met a couple. And listen, that was Riley's story from back in my credit union days.

But let me tell you about John and Mary Thompson again, that's. They're not their real names. I'm using that for sake of our show here today. They're sitting in my office and Mary starts crying.

Her husband John reaches out and squeezes her hand. He was trying to support her. And I knew these folks, we'd Gone to church together. And they weren't just church members. You know, here's the deal.

John led to youth ministry and Mary taught Sunday school. That dream Home Depot said to me, ralph, it's like chasing a mirage. And Mary looked at me and she said something I'll never forget.

She says, ralph, five years of saving and we're getting nowhere. Every time we save more, those house prices just keep climbing.

She shared with me, she said, ralph, we're starting to question if this is even God's plan for us. And I felt so bad for her and her husband. I said, I get it. You're doing the right things. You've been saving for five years. You're being diligent.

Like the Bible verse talked about this. You're being diligent. You're working towards something. And I said, let's think about this for a second. How can we change this dynamic?

And this is how we transform everything. Because we started talking about things beyond saving money. And I work with them to what I call the kingdom first strategy.

And it was based on the fundamental principle of seeking first his kingdom and his righteousness. That's right, from scripture. And they really like this idea. They said, you know what, Ralph? We're going to start really doubling our efforts to save.

She said, we're going to make this happen. And I could tell, like their whole Persona changed in my office that day. And they left.

And I guess it was a month or two later she called me and she says to me, she said, you're never going to believe this. They were three months into their new financial plan and whammo. John lost his job. Now, working at the church wasn't his full time job.

He had a job outside of that, but he worked with youth ministry there. And at this point, I expected Mary and John to say, you know what, Ralph? I give up. I'm throwing in the towel.

But what she said next absolutely floored me because you know what they did. She says, ralph, here's what we're going to do. We're going to keep on the path we're on. We're going to keep tithing. Yeah, you heard me right.

They maintain their giving even when conventional wisdom screamed to stop. Most people would say, you know what, Lord, okay, you've said enough. I've tried, I've tried. I've saved for five years.

We double down our efforts and then John loses his job. Like, I give up. But they made it through. They lived on their emergency fund. John picked up temporary work while he was job hunting.

They stayed true to their faith. They strayed true to that focus of where they wanted to get. They had that destination in mind.

Fast forward two more months and let me just say, as I say this today, it still gives me goosebumps. Mary called me, she goes, ralph, you're never going to believe this. My husband John just landed a better job with a higher salary.

And I remember her saying to me, she said, praise God. She says, prayers have been answered.

And she said to me, when we focus on serving others selflessly rather than just chasing profits and just chasing savings, incredible things happened. And when he got this new job, she said to me, she said, ralph, we're going to double down on our savings effort.

And she said, I'm even going to do something that I never expected to do. She says, I'm going to start making homemade bread. I'm going to sell it at the farmer's market.

And her and her husband attended every financial education class they could find. They come in and meet with me a couple times. They research first time home buyer programs. And it didn't happen overnight.

But within three years, get this, they had not only saved enough for their down payment, but they found the perfect house for ministry. Now I'm talking about a finished basement which was ideal for youth group meetings, and this huge kitchen where Mary could teach both baking and.

And she had a women's Bible study and she did that right in her kitchen so she was able to teach biblical principles. And let me just tell you, today their home's not just a house. It's a testament to God's faithfulness when we put his kingdom first.

They could have given up. They had saved for five years and they doubled down their saves. And John loses his job. Most people would have said, I've had enough, I give up.

But he went and got a temporary job. Then he landed a big job. What they do, they doubled down even further.

And so it truly is a testament to God's faithfulness when we put his kingdom first. And now they host weekly Bible studies, they mentor other couples, and they share their story of hope to countless other people.

And that's why I'm sharing it with you today. And it made me think of three key principles that made all this possible. And this is one my key takeaway today.

Number one thing, never compromise your giving. It's easy to walk away from that. And you're saying, ralph, this is a show about buying my first house. What does this have to do with giving?

It's that faithful stewardship seek his kingdom first. Number Two thing, if you're listening to this show, you're already making these strides towards doing this practice wise financial planning.

You gotta save consistently like the wise who store up resources. And number three, and I think this one is the vital part of this, three things. Use your success to serve others.

Just like the Thompson, their home became a ministry tool. It became something that they would use as a testimony to others.

They could point back to eight, nine, ten years ago when they had this dream of being homeowners, and they can tell the story about what they went through and they could sit there in the home that they work so hard to get. And Mary and John would tell you right now that it wasn't about them. It was about the Lord himself. And it teaches us something powerful.

The path to home ownership isn't just about money. It's just not. It's about faith. It's about perseverance and keeping our priorities aligned with God's purposes.

And Kiley, I hope that that is encouraging to you today because you're right. We're in a place where home prices are going up and interest rates are volatile. I totally get that. But stay focused.

Now, I told you I'd share a few government programs while we're here, and I wanted to share these with you. So these are like bigger picture issues. There are some ways that you can get into a home. The first one is what they call FHA loans.

These are very common. These are insured by the Federal Housing Administration. That's why they're called FHA LO loans.

And the nice thing about these, they give you lower down payment requirements. There's reduced closing costs. And so these are ideal for buyers with limited savings.

So if you're like, Kiley, you're looking to buy that first house, but you don't have that money for the down payment. One of the first things you could do is take a look at one of these FHA loans. Now, there's also VA loans.

So if you are a veteran, you would be entitled to a VA loan. These are backed by the Department of Veterans Affairs. And with this one is beautiful. There is absolutely no, no down payment needed.

And they've got competitive interest rates. So if you qualify for one of those, I would highly recommend that.

Now, listen, if you live in a rural or suburban area, you could apply for what's called a USDA loan. Those are done by the U.S. department of Agriculture.

Now, there are some income restrictions, there's location restrictions, but again, no down payment required. They got competitive rates. And you got to make sure, like I said that the home is USDA eligible.

And like I said, here's another thing you don't want to overlook. And I actually used this back when I bought my first townhouse. I was 22 years old. Other people have used this.

There's a lot of down payment support options out there.

There's state local assistance programs, there's first time home buyer grants, there's forgivable loans available, tax credits, there's programs from nonprofit organizations. And a lot of these will cover down payment and closing cost. And again, there's various eligibility requirements.

So those are all the things that you might want to look at when you're looking to do this. Now let me ask you a question. Are you ready to stop dreaming to start living in your first home?

If you listen to you like Ralph, I think I can do this. Like many first time homebuyers, you might be watching home prices rise while feeling left behind.

You're struggling to save enough for a down payment. I'm going to talk about how to do that in a few minutes. Maybe you're feeling overwhelmed by that mortgage process. Yeah, that's not an easy process.

And maybe you're just unsure where to start your home buying journey because you've heard so much garbage on the Internet. But I'm going to tell you, take heart because your path to homeownership is closer than you think. And I will work with you.

Together we'll turn your dream of owning a home into a reality while staying true to your Christian values. I can help you with this. Your homeownership journey starts here. Here's what I do. I'll review your current financial position.

We'll create a realistic saving strategy. We'll explore some first time buyer programs, will help you build a strong mortgage application.

And I'll help you navigate the home buying process with confidence. If you work with me, you're going to know about this. About me. There's no judgment, just guidance.

We're going to develop a practical faith based plan tailored to your unique situation. Because here's the things I do know. Homeownership will build lasting wealth. It's going to create stability for your family.

Stop paying someone else's mortgage and invest in your future while honoring God. Don't let another year pass without taking action. Book a call with me. You do it at askralph.com just go right to that website.

The top you'll see a button that says book a call with Ralph. And let's turn your home ownership dreams into reality starting today. Again that's at askralph.com click on book a call.

Now, as you know, a few days ago I started putting reflection questions in here and then I'm going to get to my action steps. But let's start with some reflecting questions. And the first one is this. How are you currently balancing your desire for home ownership?

You know, how are you, how are you balancing that with your commitment to biblical financial principles? What are you doing? Are you being faithful stewards?

Are you being like the Thompsons and really working on saving, really working on putting that together? That program number two thing, what specific steps have you taken this week to improve your saving habits?

You might be tuned into this because somebody referred this episode to you and they said to you, hey, go listen to Ralph, he'll help you buy a home. But what specific type steps are you taking? I'm going to get to some of those steps in a few minutes.

But what are you doing right now and what can you do this week to improve your saving habits? Because listen, you're going to have to save some money.

Yes, there are some down payment programs out there to help people, but you got to start putting that savings plan together.

And the third reflection question today, and this one I think is the most critical one, have you sought God's guidance in your home buying journey through prayer and meditation? That's really the question for today. Are you asking God for his guidance? Are you putting him first?

Now let me get to those action steps because here's the truth. People will lie to you and tell you all kinds of nonsense. Well, here's the truth. Budgeting and savings are foundational steps towards homeownership.

That's the key to this whole thing. Because here's the truth. Financial preparedness will increase your chance of mortgage approval. It just will.

And proper planning helps ensure sustainable homeownership.

That's why when we work with that credit union program, we made sure that people got education, we made sure we had training programs for them because we can put them into a house. But if they don't have that sustainable planning, they don't have those budgets. They don't understand what to expect.

Are we just setting them up for failure? So let's get to some details. So one of the things you can do right away, start tracking your expenses, monitor all your spending, use digital tools.

I've done a host of shows about this. Categorize your expenses, pay attention to what's going on and try to reduce those unnecessary areas you're spending.

So track your expenses, create a workable budget. Use that budget. If you're going to buy a house, plan for projected home ownership costs.

You know, you're going to have things like the monthly mortgage payment, property taxes, home insurance, maintenance and repairs, utilities, HOA feel fees. And then you better build in a buffer for unexpected expenses. So plan it ahead of time. If you're saving money, build that emergency fund.

Target three to six months of living expenses and then worry about building that fund for a home purchase.

You got to get that emergency fund done first and then make sure that you're paying down your, you're making your down payment savings strategy, be specific about it.

You know, understand the amount of the home that you can afford and work towards that, work towards what that savings level needs to be because if you're going to be successful in this, you're going to have to do those things. Now the other thing I want to bring to your attention is if you want to get into some more details, I can only cover so much on this show.

Every day I write a blog post. You can find those askralph.com/blog today's show will have a blog post associated with it as well. And I know we've covered a lot today.

And Kiley, I want you to understand, I get where you're at. You feel frustrated, you feel discouraged. But don't lose hope. Focus on prayer, focus on that savings.

Look for those programs that are out there to help you envision yourself in that home because you can do it. There is hope for what you want to do. Now tomorrow I'm going to change the subject a lot.

We're going to talk about tax refund loans and why I think they're a terrible idea. So you don't want to miss tomorrow's episode about a financial trap that many people fall into. And as I close today, remember this.

My passion is to help you achieve financial success. I want to see you live out your dreams and I want to see you grow in your faith.

And I know together, working together, we can master your finances from a Christian perspective. So as I always end this show, stay financially savvy out there and God bless you abundantly.

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00:28:33

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