Speaker 1: And we're here for the b a q A, the
Speaker 1: b a q a, the b a q a. Mm hmm,
Speaker 1: go ahead, Mandy, I'm gonna.
Speaker 2: I'm sorry, I didn't know what the second.
Speaker 3: So it's time for Brown Ambition Question and answer. If
Speaker 3: you've got a question and you need an answer. We're
Speaker 3: not your financial advisors or your financial you know, I
Speaker 3: don't know legal legal jargon jargons to your grandma. We're
Speaker 3: just girlfriends here who are sharing what we might likely
Speaker 3: do in this situation, and you will take it with
Speaker 3: a grain of salt and meet with your said financial
Speaker 3: expert person in your life that you pay money to
Speaker 3: and decide if that's if that's you know what fits
Speaker 3: best for you?
Speaker 1: Okay, I mean ak baqa.
Speaker 2: Yeah, Q and a light lowercase A. All right, let's
Speaker 2: dig into this reader listener email. Okay, so again you
Speaker 2: can reach us, out reach us out. You can reach
Speaker 2: out to us at Brannambition Podcast at gmail dot com,
Speaker 2: or go to Instagram and slide into our dms Brown
Speaker 2: Ambition Podcast on ig. Try to keep them, you know, succinct,
Speaker 2: give us information, but not too much information, okay. It
Speaker 2: just helps us answer them in a timely manner on
Speaker 2: the show. But what do we have for our first
Speaker 2: question today?
Speaker 3: Tiv So first we have let's see, Oh she'd like
Speaker 3: to be called Eve. Eve says, Hello, ladies, Love Love Love.
Speaker 3: I've been a listener for years and I'm happy to
Speaker 3: watch and hear all of your recent accomplishments.
Speaker 1: Thanks Eve. Here's my dilemma.
Speaker 3: I purchased my first home, a condo in the DC
Speaker 3: area in the fall of twenty nineteen. At the time,
Speaker 3: my credit score was just good air quotes in the
Speaker 3: high six hundred, so the interest rate I was offered
Speaker 3: from my credit union was five point two five percent
Speaker 3: with no PMI, which actually is not bad for that
Speaker 3: with a three percent down payment. I was in experience
Speaker 3: and made the mistake of not shopping around. Over the
Speaker 3: past two years, I've been working really hard to improve
Speaker 3: my credit in the hopes of refinancing, since I plan
Speaker 3: on keeping this property and passing it down to my family.
Speaker 3: Love that my credit score is now in the high
Speaker 3: seven hundreds, perfect and with interest rates at record lows
Speaker 3: and area housing prices at at all time high, I
Speaker 3: feel like now it's the perfect time to pull the
Speaker 3: trigger and begin the refin process. My situation gets complicated
Speaker 3: because I'm also looking to change jobs in the next
Speaker 3: ninety days, and from my experience back in twenty nineteen,
Speaker 3: making any major life changes during the housing process is
Speaker 3: generally frowned upon. So my questions to you are, should
Speaker 3: I refine now while still seeking new employment, wait until
Speaker 3: I land a new job to begin the refin process,
Speaker 3: or refine now and put my job search on hold
Speaker 3: until I finish refinancing in a few months. Bonus question,
Speaker 3: knowing I don't have twenty percent equity in my home yet,
Speaker 3: so a lot of lenders may require PMI, is it
Speaker 3: better to take a lower interest rate and pay a
Speaker 3: couple hundred and PMI for years or get a slightly
Speaker 3: higher interest.
Speaker 1: Rate with no PMI.
Speaker 3: Okay, Eve, if we're going to focus on your main question, right,
Speaker 3: should I rEFInd now while still seeking new employment? Here's
Speaker 3: the thing, Eve, It's not generally frowned.
Speaker 1: Upon to quit your job during the home brian process.
Speaker 1: They will cancel like sis. Think about it.
Speaker 3: Let's pretend that Mandy is the bank, hey, bank of
Speaker 3: mandra Hi, and I'm just Tiffany. I've been teaching for
Speaker 3: ten years, which they love. By the way, you know,
Speaker 3: and I've come to you and I would like to
Speaker 3: borrow some money from you, right, we have that, right?
Speaker 3: And so I've got a job, very stable, love it,
Speaker 3: ten years as a teacher, amazing, and I'd like this house.
Speaker 1: Can I borrow some money?
Speaker 2: Sure, we'd love to give you lots and lots of money.
Speaker 3: Okay, So halfway through the process, ooh, Mandy, you know
Speaker 3: how I said I had that job?
Speaker 1: Yeah? We love that.
Speaker 3: Yeah. Yeah, so I kind of quit, but I do
Speaker 3: have a new job. We didn't even plan that skit,
Speaker 3: you see how me and Mandy we just did sync.
Speaker 3: We just did sinc So, Mandy, why does that happen?
Speaker 3: Why would that happen?
Speaker 2: Because you, when you are, when you're getting a mortgage,
Speaker 2: you and your credit and your income, all of it
Speaker 2: is like a delicate little house of cards, and if
Speaker 2: anything changes, the bank does not want to lend money
Speaker 2: to you anymore, even if you're changing for a good reason,
Speaker 2: you got a higher paying job. They go through such
Speaker 2: a rigorous underwriting process that them having to go back
Speaker 2: and recalculate things just messes them all up, gets them
Speaker 2: out of whack.
Speaker 1: They don't like it.
Speaker 2: So I would definitely say open door number three out
Speaker 2: of these options, which is put the job search on
Speaker 2: hold for now, at least officially changing, I would say, interview,
Speaker 2: do all that cute stuff until you finished your refine
Speaker 2: process in a few months. That way, you can take
Speaker 2: advantage of these low rates right now and hopefully the
Speaker 2: job that you're seeking will be out there and they
Speaker 2: can be a little patient for the next couple of months.
Speaker 3: Because you have to think about this Eve that even
Speaker 3: if you, to Mandy's point, you get a job that
Speaker 3: pays you more, the bank doesn't care.
Speaker 1: You know what the bank cares.
Speaker 3: About stability, Like I make significantly more than my husband,
Speaker 3: but he's been at his job for twenty years. Do
Speaker 3: you know when At first, because y'all know, I bought
Speaker 3: this home and we paid cash for it because we
Speaker 3: happened to find a foreclosure that was like fifty percent off.
Speaker 3: But before that we were looking for homes that we
Speaker 3: were going to finance. The bank was like, I don't
Speaker 3: give a what about what tivity make. It had whole
Speaker 3: old ramshackle budgetista up down left right. They're like, now,
Speaker 3: mister Smith, you are very attractive with your twenty years
Speaker 3: of service.
Speaker 1: I was like, I made one of him. They're like,
Speaker 1: we don't care. We don't care.
Speaker 3: The bank like stability. They like to know this person
Speaker 3: is highly likely to have my coin. And if you
Speaker 3: have a new job, who knows how long that that
Speaker 3: job will have you, versus like being at the job
Speaker 3: where you are now. So I actually had a friend
Speaker 3: that did this. They actually moved. They he knew that
Speaker 3: he was going to be quitting his job and he
Speaker 3: was going to get a new job. He wait, he
Speaker 3: waited until he closed, was in the new house, and
Speaker 3: then jumped to the new job. They can't do anything
Speaker 3: once you're already at your new place. So yeah, to
Speaker 3: Mandy's point, wait, sis, don't do nothing crazy. And I
Speaker 3: love the fact that your credit score is high seven hundreds.
Speaker 3: Anything over seven forty, it's considered perfect credit, which is awesome.
Speaker 3: And yeah, I think that you know you're in a
Speaker 3: great position, But don't don't get a new job just yet.
Speaker 3: I love.
Speaker 2: Can we take the bonus question really quickly? Because she says,
Speaker 2: a bonus question is knowing that I don't have twenty
Speaker 2: percent equity in my home yet. So a lot of
Speaker 2: lenders may require private mortgage insurance. Is it better to
Speaker 2: take a lower interest rate and pay a couple hundred
Speaker 2: dollars and PMI for a few years, or get a
Speaker 2: slightly higher interest rate with no pm I. So my
Speaker 2: favorite thing, especially when you're because I almost called him Superman.
Speaker 2: That is not my husband, Husban Husby and I we
Speaker 2: actually did refinance our mortgage last year around this time,
Speaker 2: last up August or September, when rates were going really low.
Speaker 2: What rate did you get if you don't mind, shoot,
Speaker 2: I don't remember, I don't remember. I don't remember.
Speaker 1: I'm sorry.
Speaker 2: A low one. But when we were doing it, there
Speaker 2: was so much conversation around because our rate was really
Speaker 2: good to start with, and I think it was four
Speaker 2: point three. It wasn't terrible. We got that in twenty eighteen,
Speaker 2: so we had to get it below three percent. I
Speaker 2: want to say two point eight seven five seems to
Speaker 2: be a number that feels good to me.
Speaker 1: I'm amazing.
Speaker 2: Yeah, the rates were really good and our credit was great,
Speaker 2: so we refinanced. But because there wasn't that much room
Speaker 2: in between the two rates, I mean, two points is
Speaker 2: a lot when you're talking about thirty years worth of interest,
Speaker 2: but we still had to make sure it was going
Speaker 2: to be worth it, because not only are we talking
Speaker 2: about doing the closing costs all over again, you know,
Speaker 2: saying for the origination fee, and yes, some lenders will
Speaker 2: waive that kind of stuff, but you have to pay
Speaker 2: for your legal fees and all that kind of crap,
Speaker 2: So there's upfront costs to it. So how we decided
Speaker 2: the break even point, which is, you know, how much
Speaker 2: are we going to save versus how much are we
Speaker 2: going to spend and is it worth it? We actually
Speaker 2: used a handy calculator from lending Tree. That's something called
Speaker 2: the break even calculator, which we can link to, and
Speaker 2: also the when you're shopping around for your VIFI and
Speaker 2: I definitely encourage you to shop around the same way
Speaker 2: you do with your mortgage, go to multiple lenders so
Speaker 2: that they compete and give you the best offer. We
Speaker 2: had two lenders, you know, going head to head, and
Speaker 2: we went with the one that had the lowest rate
Speaker 2: in the best customer service. But anyway, when you have
Speaker 2: them compete, they will also help do a lot of
Speaker 2: that math for you and they can tell you, you know,
Speaker 2: here's what makes the most sense. So I don't have
Speaker 2: a specific answer, but what I'll say is, there's calculators,
Speaker 2: and then you can also ask the lender agent whoever
Speaker 2: you're working with, to help you with that math as well.
Speaker 3: Hmmm, look at the math. Make sure to math maths.
Speaker 3: E Okay, but we're proud of you. I think I
Speaker 3: love the fact that you know, you got this great condo,
Speaker 3: you want to pass it down, and you're you worked
Speaker 3: hard to get your credit score up.
Speaker 1: You know, just wasteis you could You.
Speaker 3: Could abandon shit as soon as you as soon as
Speaker 3: you get your your money tight abandoned.
Speaker 2: Something feels very adult about something refinancing a mortgage that
Speaker 2: was like the most adult thing I've done outside of
Speaker 2: having a child. Like, nothing is more adulty hardly than refinancing.
Speaker 2: I mean a mortgage first time cute, but refin so
Speaker 2: you're really on your grown is right now and I'm
Speaker 2: here for it.
Speaker 3: Yes, but be mindful this because my friend got my
Speaker 3: friends got like kind of kind of side not sidetracked.
Speaker 1: What is that person when they side sidewiped words?
Speaker 3: So because their house was worth much more when they refinanced,
Speaker 3: their taxes went up, So just be mindful that that
Speaker 3: might be something because you know, home prices have gone
Speaker 3: up astronomically that it might affect. So they were able
Speaker 3: to save four hundred dollars a month in refinance and
Speaker 3: their taxes went up six hundred dollars. So they were like,
Speaker 3: are you kidding me? So just be mindful of that
Speaker 3: as well about like, you know, will your taxes potentially
Speaker 3: go up? All?
Speaker 1: Right, next question.
Speaker 2: I'll take this one. I'll read it anyway. This comes
Speaker 2: from listener Ayana, Ayana. We'll say hi, Tiffany and Mandy.
Speaker 2: I love the podcast so much. I have a question
Speaker 2: about how to calculate net worth. We just started tracking
Speaker 2: it in January and hit a major milestone positive net
Speaker 2: worth mini dance party. We're dancing with you a but
Speaker 2: I do want to make sure we're calculating it correctly.
Speaker 2: I know that net worth is our assets minus our liabilities,
Speaker 2: but I'm not quite sure where the mortgage falls in that.
Speaker 2: Do I simply subtract how much we owe on the house,
Speaker 2: which is how we're currently tracking, or do we include
Speaker 2: what Zillo told me is the worth of the house.
Speaker 2: We would love y'all's assistance. Thank you so much for
Speaker 2: your help.
Speaker 1: Ayana.
Speaker 2: This is a really good question, very good question.
Speaker 3: It is It's one of the chapters in my book
Speaker 3: gik with Money gig money dot Com. You know I
Speaker 3: haven't plugged it in a while. Yes, but go ahead, man,
Speaker 3: I just want to have.
Speaker 2: You have the giant poster of yourself playing you. But yeah, sure,
Speaker 2: it's been a minute. Gig himmay dot com.
Speaker 3: Y'all.
Speaker 1: This is a good question.
Speaker 2: No, you're you're right though. The key is when you're
Speaker 2: calculating your net worth as far as your home is concerned.
Speaker 2: You can't just look at how much you owe on
Speaker 2: a mortgage or how much your home is valued at
Speaker 2: in a vacuum like separately. You have to subtract one
Speaker 2: from the other to get your equity. So what I
Speaker 2: would do. It's hard because it's difficult to understand what
Speaker 2: your home is valued at now because until someone buys
Speaker 2: your home, you don't know for sure. Your home is
Speaker 2: only really worth what people will pay for it. There's
Speaker 2: ways that you can estimate it. One way is Zillow,
Speaker 2: which is not necessarily the most accurate, but it can
Speaker 2: give you a It can give you a ballpark. Another
Speaker 2: way is to ask a realtor in your area or
Speaker 2: see you know, do a quick little survey of home
Speaker 2: similar square footage amenities in your area that have sold
Speaker 2: recently and what they sold for price, price per square
Speaker 2: foot and then kind of try to suss out your
Speaker 2: value from there. Once you have your value, you can
Speaker 2: subtract your mortgage or how much you owe on it
Speaker 2: from that value, and you have a general sense of
Speaker 2: your equity it equity estimate, I would say, and that
Speaker 2: can be added on top to your your network.
Speaker 3: I want you to think of like I think about
Speaker 3: like like when you're doing a network for people who
Speaker 3: are doing your network, that it's like two columns. There's
Speaker 3: the asset column and there's a liability column and so
Speaker 3: and at the bottom, it's like you're adding up all
Speaker 3: your assets. At the bottom, you're adding up all your liability.
Speaker 3: So assets are things that are putting money into your pocket.
Speaker 3: Liabilities are things taking taking money out of your pocket.
Speaker 3: And then at the bottom those totals you're gonna subtract,
Speaker 3: you know, what's taking money out of your pocket from
Speaker 3: what's putting money into your pocket. So if I was
Speaker 3: looking at it, like you know, you're creating this chart
Speaker 3: on the asset side, I would have the like Maddy said,
Speaker 3: the estimated value current value of my house on the
Speaker 3: asset side. On the liability side, I would have current
Speaker 3: the current balance site oh on my house. So there
Speaker 3: has to be a balance when it comes to mortgages
Speaker 3: or cars, you know, things that you owe money on
Speaker 3: because you have to have on one side what it's worth,
Speaker 3: on the other side what you still owe on it.
Speaker 1: And that's how it balances.
Speaker 3: So like for any of you, like budding accountants, you know,
Speaker 3: that's just balancing your balance sheet.
Speaker 1: And so that's how you'll know.
Speaker 3: So knowing for your home, your car, and maybe you
Speaker 3: own a boat or whatever, that you should have something
Speaker 3: on both sides of that of that column, and it
Speaker 3: will help you to know that you are at least
Speaker 3: fairly accurately deciding you know, how much your your net
Speaker 3: worth is.
Speaker 1: But you know that's awesome.
Speaker 3: A positive network just means that you own more than
Speaker 3: you owe. That's really key, owning your assets, owing your liabilities,
Speaker 3: and that's the ideal that you're wanting to The only
Speaker 3: way to really raise your net worth is you have
Speaker 3: to eat their own more and or oh less. And
Speaker 3: if you do that, you know you really because people
Speaker 3: can have a ton of money. I mean we've seen it.
Speaker 3: People have a million dollars you know, in the bank,
Speaker 3: but they owe ten million, so their net worth is
Speaker 3: negative nine million dollars. So you can have a lot
Speaker 3: of money but have a terrible net worth. To me,
Speaker 3: net worth is one of the numbers, like a credit
Speaker 3: score or debt to income ratio that it helps to
Speaker 3: really gauge like the health of your overall finances and
Speaker 3: so like, congratulations on a positive network. Iyaha, that's awesome,
Speaker 3: So keep going and keep like.
Speaker 2: Student loan debt is the secret killer of net worth
Speaker 2: in this for millennials and Gen xers for sure, and
Speaker 2: increasingly senior citizens, which is pretty damn sad. And there's
Speaker 2: been like very little movement on the whole student debt
Speaker 2: cancelation front. But I mean, if you look at your
Speaker 2: net worth, truly, I guarantee you, for a lot of people,
Speaker 2: it's student loan debt that's holding them back.
Speaker 3: Which speaking with speaking about holding people back, we got
Speaker 3: an interesting how are we gonna do this?
Speaker 1: And here's the thing.
Speaker 3: Okay, so I'm i'm we're gonna rename her because I
Speaker 3: don't want to put you maybe you put it, gave
Speaker 3: a fake name. We're gonna name her Sincere okay from Arizona.
Speaker 3: Now maybe you gave us so Sincere from Arizona. I
Speaker 3: thought yes. So she's sick of her Sincere from Arizona. Look,
Speaker 3: she's sick of you. She's sick of you, your boss,
Speaker 3: her boss. She's sick of you, she's sick of your mess.
Speaker 3: She's sick of your foolishness. She's sick of you having.
Speaker 1: Your right hand.
Speaker 3: And you don't even want to lean into the fact
Speaker 3: that she's amazing. She's about to be out anyway, you know,
Speaker 3: because you don't really acknowledge her accomplishments. Sincere is sick
Speaker 3: of you and your foolishness. Now that's not her name,
Speaker 3: that's not where she lives. You know. We I don't
Speaker 3: even know if these names and things are right, but
Speaker 3: we we feel you Sincere. Well. I can't read this
Speaker 3: out loud because I do not want where you work
Speaker 3: to let you go before you are ready to be
Speaker 3: let go.
Speaker 1: But she's here. We wish you well, We wish you peace. Girl.
Speaker 3: Don't let don't let them talk to you crazy. Don't
Speaker 3: let them make you feel crazy. Sincere, me and Mandy
Speaker 3: are rooting for you. I see you've been at the
Speaker 3: job for some time. But that's the right though. You're dope, girl.
Speaker 3: Don't let them make you feel less thing you you
Speaker 3: are the job. See how they do without you.
Speaker 2: Okay, so yeah, this is the This is the one
Speaker 2: excerpt that's maybe safe to read, but the core, the
Speaker 2: core thing is clearly Sincere it just wants to vent
Speaker 2: because they have been working at this job for a
Speaker 2: long time. Don't feel appreciated, They say, I don't understand
Speaker 2: why every year I have to provide a list of
Speaker 2: accomplishments to prove why I should get an increase when
Speaker 2: I think my work speaks for itself and I am
Speaker 2: doing the work of four people while being underpaid. This
Speaker 2: is this is, this is the thing, Sincere. If they
Speaker 2: you have to believe who people are when they show
Speaker 2: you the first ten times, okay, at least the first one, two, three, four,
Speaker 2: ten times. And in this case they have shown you
Speaker 2: that you know you're You're work isn't valued you, you
Speaker 2: aren't getting support that you need. So I feel like,
Speaker 2: as angry as you are and as hilarious this is,
Speaker 2: I just want you to be happy, Sincere. So I'm saying,
Speaker 2: get your resume dusted off and don't feel you have
Speaker 2: been there a long time. Don't feel a lick of
Speaker 2: shame for going on your merry way and working for
Speaker 2: a place that hopefully values you a hell of a
Speaker 2: lot more than this place has. Yeah, virtual hug, I
Speaker 2: kind of wish this was tequila. Now it's just water.
Speaker 1: Don't let them, don't let them stress you else. Listen
Speaker 1: to get your kiky on.
Speaker 2: This was a healthy venting, you know, strategy though coping mechanism.
Speaker 2: You can y'all convent to us, I mean, maybe not
Speaker 2: so much, but vent to us.
Speaker 3: Put it, you're not here, Yes, we are not here
Speaker 3: that we will not if we think there's anything in
Speaker 3: here that maybe you're not really thinking through that, Like,
Speaker 3: oh wait, my boss or whomever might be able to
Speaker 3: tell us me we're good enough to be Like no,
Speaker 3: I'm not gonna say that part.
Speaker 2: And I really hope there's no one names since here
Speaker 2: in Arizona, we don't mean you like no not.
Speaker 1: Her boss is like, oh words here, I heard about
Speaker 1: you on the b A.
Speaker 2: Pseudonym pseudonym.
Speaker 3: Okay, So if you have a QA for the b A,
Speaker 3: then please submit it to us at Branna Vision podcast
Speaker 3: dot com and click ask us anything. Certainly you can
Speaker 3: send us a d m on ig We like that
Speaker 3: as well. And if your thought this is really helpful,
Speaker 3: please share this podcast with three friends. Literally copy paste
Speaker 3: the link and say you need to listen. I laughed,
Speaker 3: I cried, I learned, I grew Okay.
Speaker 2: Oh god, that put that on a put that on
Speaker 2: a poster. I need that right behind me. I laughed,
Speaker 2: I cried, I learned, I grew from brown ambition. All right,
Speaker 2: until next me a Sam Bye,