 Question: Do you ever recommend someone selling their house to get out of debt?
Answer: The only time you’ll ever hear me tell someone to sell their house to get out of debt is as an absolute last resort. If there’s just no other way to turn a corner, then it might be an option. Another would be if you don’t really like the house, and you’ve considered selling it anyway. The third situation would be if the house is just too darn expensive. If you’re sending half of your monthly income to the bank to make house payments, then you’ve got way too much house!
But most of the time the house is not the problem in these kinds of situations. There’s usually lots of other stuff, like credit card debt and $700 car payments. I’d sell a car in a heartbeat before I’d ever consider giving up my home. Think about it. Being forced to sell your home in a case like that would be an emotionally devastating experience. I mean, it’s your home.
And the truth is that in some places it would be a pretty good idea to hang on to a house. A lot of markets are already recovering at a rapid pace, and the real estate market in America —with the exception of a few trouble spots—is a lot more alive, dynamic and fluid than many people in the news media would have you believe. There are some seriously good real estate situations out there right now!
Question: What are the advantages of using a real estate agent versus going the for-sale-by-owner route when it comes to selling a home?
Answer: I’ve had a real estate license for 30 years. If I were to put my personal residence on the market today, I’d use an active real estate agent who really knows his or her stuff in the marketplace. I’d gladly pay them their commission, too.
Now, why would I do that if I could just sell it myself and save the commission cost? For starters, if I do a for-sale-by-owner, or FSBO, I’m only getting my place in front of buyers I can attract from seeing a newspaper ad, Craigslist, and anyone who happens to drive by the house. If you go with a high-octane real estate agent, you’ll have the advantage of being exposed to their entire pool of buyers. More importantly, you’ll be in the MLS, or Multiple Listing Service, database. There, you’ll immediately have thousands of potential buyers. So, who do you think will have the best chance of selling your house? Market exposure is everything in the real estate game!
And think about this: Even if you went the FSBO route every time you moved, you might do three or four of these transactions in a lifetime. A good agent closed three or four deals last week! They’ll know all the ins and outs of buying and selling a home, and they’ll walk you through every step of the process. Research has shown that between basic mistakes, pricing errors, and lack of negotiation skills, you’ll cost yourself more than the agent’s commission by trying to sell it yourself.
Trust me, you’ll get a much better deal—with a lot less hassle—by using a top-flight real estate agent!
Dave is the author of The New York Times best-selling book Financial Peace. He is also the host of the nationally syndicated The Dave Ramsey Show, and is a regular guest on television. All of his financial counseling is based on biblical truths. You can hear Dave from 9 a.m. to 11 a.m., weekdays, on WLWI 1440 AM or online at www.daveramsey.com. Send your questions to
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This e-mail address is being protected from spambots. You need JavaScript enabled to view it . He resides with his wife Sharon and their three children, Denise, Rachel, and Daniel, in Nashville, Tennessee.
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