Keys Over Rates

Think owning a home is out of reach because rates are high or you don’t have 20% down? Let’s flip that script with real numbers, clear steps, and the kind of market context that actually helps you move. We break down the true cost of renting versus buying, how much cash you really need, and why today’s buyer-friendly landscape can put you in control—rate buydowns, seller-paid closing costs, and room to negotiate included.

We start with the essentials: what lenders look for, how to position your credit, and the exact documents that speed up approvals. You’ll learn why a 640+ score opens better programs, how debt-to-income shapes your price range, and why shopping two to three lenders can save thousands over the life of your loan. We dive into FHA’s 3.5% down path, state and county assistance, and the myth-busting truth that many first-time buyers bring around $1,000 to get started while using structured support for the rest.

From there, we zoom out to timing and leverage. More inventory shifts power to buyers, which means fewer bidding wars and more concessions. Waiting for rates to drop might feel safe, but it can push you into a seller’s market where cash-heavy offers win. The smarter move? Secure the right home now if the numbers work, then refinance later if rates improve. You’re buying the house and renting the rate.

We also talk freedom and security: fixed payments that don’t jump at renewal, the ability to improve what you own, and the long-term wealth effect of equity growth. Plus, a peek into turning a primary home into a rental or short-term rental—how equity can fund life changes and why investor math varies city to city. Whether you’re nineteen with a clean credit file or starting later with a focused plan, the path is the same: know your numbers, use market leverage, and move when it makes sense.

Ready to see what you actually qualify for and build a plan, even if you’re a year out? Hit follow, share this with someone who’s renting, and leave a quick review with your biggest homebuying question—we’ll answer it on a future show.

Transcript

Welcome, Topic Reveal: Real Estate

SPEAKER_00 0:00

Hi guys, welcome back for this week's episode of Tuf Love and nothing because she's pregnant, so we're not having thick up this. So nothing. This week.

SPEAKER_01 0:11

What are we talking about this week, Judy? Um, we're gonna be talking about real estate. Like, what if like I was gonna ask you what do you need, or what like what is the best time to buy a home?

SPEAKER_00 0:25

The best time to buy a home is when you can afford one. So what I do with my clients is we go through their budget, we go through their expenses, and then we compare what rent is versus versus buying. Um full disclosure, interest rates in the sixes, nine times out of ten, it's more expensive to buy than it is to rent. Um, but you're not just looking at that monthly expense. What you're looking at is your investment. So, you know, for example, if you're paying$2,000 a month in rent in the end of a year, you've spent$24,000 paying towards someone else's mortgage. Where you know, if that rent payment is turned into a$2,500 mortgage at the end of the year, you've paid that money into your mortgage, which basically converts it to equity that either you can borrow against later or it just accrues and you are actually putting money towards something that is yours. So that's kind of where I like the baseline that I start with my clients.

SPEAKER_01 1:30

Okay. Um, what do you need like to get started with like finding a home and everything? What would you say is like literally like a get ready, like type of package thing that's stepping into looking at for it?

SPEAKER_00 1:43

So the process really is first and foremost, you have to get your credit pulled. Um somehow, I don't know, a lot of people think they you they can just tell you how much they make and you can tell them how much they qualify for, but every person's circumstance is different and you really have to look at their whole financial picture. Um, so the best way to go about it is to get in contact with the lender. Um, we have our approved lenders, um, but you're also more than welcome to use any lender, really. Um, I encourage my buyers to shop for their mortgage. Um, you don't have to go with my recommended lenders. Um, but I always tell them, you know, if they don't have at least two or three, um, you want to compare. Right. Because different banks offer different programs and different things. So shop for your mortgage is basically the term that's used. Um, but if for whatever reason your credit score is too low or you don't have enough income or you have too much debt, which is what we're seeing a lot these days, um, then we go back and we go to the drawing board and we basically put a game plan in place. Um, but really the short answer after I gave a long one is you need a credit score. Some people say 580. I say 640 because I want you to get, I want to get my buyers in the best programs. Um, and so you need at least a 640 credit score, two years of employment tax returns. They don't have to be with the same employment, preferably in the same field without what more than a six-month gap and uh thousand dollars of your own money. Um, I will say I just got an email about a bank that was offering where it's only$500 of your own money, but that's a varying program. Um, but I can tell you you at minimum a thousand dollars of your own money that would be used towards your earnest money. Um, but you're also gonna need money for your inspection and for your appraisal because those are upfront out of pocket expenses. Okay. But you know, it's based off your debt-to-income ratios, which is basically how much you bring in every month versus what your debt is. So my advice to anybody that's looking to buy a home within the next, you know, one to three years, even, is to just start with the lender, see what, see what it looks like. And if not, put a plan in place if your credit score is too low and there isn't a way to raise it other than you know, paying down credit cards um and getting rid of collections. I have a program for credit repair that could help get your scores increased. Um but that's really that's really it. I mean, it's not some people think it's it's so it's it's this daunting process, but really it's just uploading uh basic financials, um, which is like your tax returns or your W-2s and uh completing the application. And you know, then they ask you for documentation that the lender requests bank statements as well. You also need bank statements. Okay. But it's not not only is the process simple, but I I mean I understand I do this in my sleep, you know what I mean? And so to someone like you that hasn't done it, it's it's really just getting past the anxiety and the fear, yeah, and getting informed.

Market Timing: Why Now Favors Buyers

SPEAKER_01 4:47

It's a lot of like for like I always hear like you talking about like like the market, like is there like a specific like best time to look into like houses? Like that I I just want to understand that a little bit more.

SPEAKER_00 5:02

But the thing to understand in real estate is the market is constantly changing, yeah. So right now we are in a buyer's market. So if anybody, if you've been considering into getting into a home, right now there's a great opportunity to you know ask the seller to pay for your closing cost or down payment to do a buy down on your interest rate so that you are able to reduce your interest rate. Um, you know, it's definitely a buyer's market. We have way more inventory um than we had in the last few years. Um and so it's basically it's shifted things where you know, right now is a great time for buyers. Um, that's not to say that sellers aren't still getting what their homes are worth. Um, there's just a lot more availability. So that kind of changes things. Um, but it's not, you know, now's a great time versus, you know, if if you wait around and interest rates drop, then what happens is the buyer ratio to available properties tends to lessen. And then we shift to a seller's market where sellers are getting multiple offers on their properties, okay. You're getting outbid. So for me, it's like I I'm really pushing anybody right now. Like if you've been on the fence about buying a home, there's there's zero obligation. Just find out what the numbers look like. If they are not in your favor or they don't make sense for you, then just hold off. Wait, there's no obligation. But I will tell you like if you're waiting for interest rates to drop, you're basically pushing yourself out of the market. Because if the rates do drop and the activity changes and the market shifts to a seller's market, yeah, then unless you have tons of money to put for, you know, appraisal waivers and you know, appraisal gaps is another term and stuff like that, then you could be left on the sidelines because you are just you're not able to compete. Right. You're not able to compete with everybody that's out there.

Down Payments & Assistance Programs

SPEAKER_01 6:49

Okay. Well, what about like when it comes to like say if you have a certain amount that you already have saved, but like it's not exactly your goal of what you want for like housing or to buy a house, but you could get a loan. How does that whole process work of like getting a loan and going through that?

SPEAKER_00 7:07

Like well, there's not really in most cases, you can't have like a second loan for a mortgage. So you have to, it's it's one loan. Um, so you wouldn't really borrow for as far as down payment or anything like that goes. And most of the money is wrapped into the loan. Okay. So a standard real estate transaction, FHA, you need three and a half percent down payment. Okay. But of that three and a half percent, there's first-time home home, there's first-time home buyer programs, there's CHAFA, there's um the Rappahoe County programs, there's there's really a real wide range of programs for down payment assistance. So that three and a half percent can get reduced towards only, like I said, that thousand dollars that you need of your own money in the transaction. So, you know, a lot of people have the misconception that you need five, ten, twenty percent down for your first purchase, and that's just it's not realistic anymore.

SPEAKER_01 8:06

Okay. All right, yeah. Sorry, I had a question. You ran out of questions. I did. Oh gosh. Well, I mean, those are like my main ones. The main ones. Yeah. I mean, maybe like what kind of advice would you give to like first one buyers, really, that are they're like really young. Say if like they're really young or whatever.

SPEAKER_00 8:33

Well, I mean, don't I don't let youngness be what holds you back. Like my first my Mike and Fish Sepulvada, my compadres, they were 19 and 20, 19 and 20 when they found them that long, I've known them a pretty long time. And it may have been 2021, sorry. I but they were they were so young. And all they did was they just they took care of their credit. They took care of their credit and they were able to um see, she was pregnant with Devante at the time. I remember like and their house. We walked into it and they had like a crib set up, and she's just like, this is it, this is the house, you know what I mean? So I don't think age, like, and to the other side of that, like you're never too old to buy your first home. It really is just a matter of the way I look at it, not only because I'm an agent, but the way I look at it, like they're never gonna make more land.

SPEAKER_01 9:27

Yeah.

Young Buyers, Equity, and Security

SPEAKER_00 9:27

They're we will run out of land. And really, like your position of power is if you own it and it's yours, or if you're in someone else's. And for me, it's it's all about like placing yourself where you kind of control things. There, I mean, there's so many things that are out of your control, but when you are a homeowner, like nobody's gonna raise your rent. Nobody's gonna tell you that you're gonna dislike to sell. Nobody's gonna tell you like um what you can and cannot do as far as home improvements and stuff like that, and you really get to make it yours. So, um that I mean, for me, those are the reasons that I wanted to own my own home. Yeah. Um, and also like to leave, like not so much like the material aspect to leave it to you guys because I don't think like I I joke with you and I told you, I don't know if you remember when you asked me who gets to keep our house in Colorado, and I was like, whoever gets to buy it. Because um, I want you guys to go out and get your own. I don't want you to, you know, um, I want you to go get your own that way you secure something for your family, which obviously what's ours will be yours in some way, shape, or form. But I feel like it's it's it's security. Yeah. It's security where, you know, God forbid something happened to us, then my kids have somewhere to be. And their kids will have somewhere to be. And for me, it's like it's not necessarily um, it's it's not a good versus bad. Um, but I do feel like there's so much, especially as expensive as everything's getting these days, like to have your mortgage and it's fixed for 30 years. I mean, obviously property taxes are gonna increase and stuff like that. Um, but it's in most cases, it's more manageable than a landlord just telling you like when your lease renewal is up that they're gonna increase it 500 bucks.

SPEAKER_01 11:10

Yeah.

SPEAKER_00 11:10

Which I've heard of that happening a lot recently. So that's that's really what it is.

Turning Homes Into Investments

SPEAKER_01 11:17

All righty. Well, thank you. You're welcome. Yeah, so I don't really have many other questions besides those. So sorry about that. But I was also gonna say though, actually, um like for people that like buy houses just to like do like the Airbnb thing that you and dad are doing too, like have somebody else that's renting it, then you're renting it out to somebody else, and then they're renting it out for the Airbnbs or something like that. How does that like how has that been for you guys?

SPEAKER_00 11:45

Well, the thing for us is we were never planning on making our house an Airbnb. We literally planned on living there forever. Like we didn't ever think like we're in El Paso. I never never saw that in my cards. Um, and so it worked out for us because it we were actually able to leverage being in like turning into investors, so to speak, because that turned into our investment property.

SPEAKER_01 12:11

Yeah.

Next Steps: Plan, Apply, Position

SPEAKER_00 12:12

Um, and so that gave us the opportunity to leverage our equity to be able to take this risk and move out here and do that um because uh the the rent would cover the mortgage. Um, and we didn't have to worry about paying two mortgages being in two places. Um but I mean I feel like there's still there's investors everywhere. There's very, you know, it's it's a lucrative business. It's a little harder today with interest rates being what they are. Um, but as long as you are able to, you know, in most cases, investors look at their profit margin and see how much of the rent they can get covered, and they're looking for most of it, to be honest. Okay. I feel like most people, you know, it it just depends. It depends on the market. Like the Colorado market's gonna be much different than the El Paso market. Right. The El Paso market's gonna be much different than New Mexico, but it's just a matter of, I tell anybody, like, if there's something that you're considering, you you start with the loan application. Um, and that's gonna tell you what your financial picture looks like, what you qualify for. And then once we have that put together, then we can go look at what properties are available and see if there's something that works. If there's nothing that works, then hey, like it is what it is. Like there's no for me, it's important to walk my people through the whole process. It doesn't matter if you're a right now client or if you're five, 10, 7 years from now. It's just a matter of giving you the tools and resources to be able to make the smartest financial decision for you and your family.

SPEAKER_01 13:36

Well, thank you for the for that information. It's actually taking it all in because yeah, especially right now. I don't I don't always plan on just staying with you know, my in-laws or with you guys or whatever, obviously we want in the future. We still want to get our own place or whatever. Of course.

SPEAKER_00 13:51

I'm excited though. I'm excited too. I mean, all you gotta do is I want it. I want to own a house. And I guess it to exist. It doesn't matter if it's now, if it's in, it's just about positioning yourself and getting the tools. And then once you have the information, it, you know, like that that's really it. Like you could, it's a decision. But does this make sense? Does it not make sense? And if not, then it's just a matter of positioning yourself and seeing what you have to do to make it make sense.

SPEAKER_01 14:16

Okay. Thank you, mom. You're welcome. Okay, thank you guys for joining us. Join us next week. Have a good one. Bye.