S2025 Ep246: Will You Afford a Home in 2026? Live Financial Analysis---PART 2

Hi, this is Alex Cantrowitz. I'm the host of Big Technology podcast, a long time reporter

and an on-air contributor to CNBC. And if you're like me, you're trying to figure out how

artificial intelligence is changing the business world and our lives. So each week on Big Technology,

I bring on key actors from companies building AI tech and outsiders trying to influence it,

asking where this is all going. They come from places like Nvidia, Microsoft, Amazon, and

plenty more. So if you want to be smart with your wallet, your career choices, and meetings with

your colleagues and at dinner parties, listen to Big Technology podcast wherever you get your

podcasts. Working across teams is tough, but Asana helps you handle it. Asana AI can spot roadblocks

and assign work to keep everything on track. That's how work gets handled. Visit us at Asana.com.

So we're going to put in here. I got $1,000 in other debt. I'm going to put down,

and this is where it gets a little intriguing. You realize if you're a first-time home buyer,

you might be able to get away with 3% down. If you don't get away with that, you go FHA,

it's only 3.5% down. So to bypass all these, just to make it simple for you, I don't want to go

through this calculator all afternoon. Let's put, we're going to put 3.5% down. The mortgage rate

today, you can go back to mortgage news daily if you want to move. Let's go, they're going to go,

look at the FHA rate, 5.72. I'm just going to pop that in there just for kicks. So let's go 5.72.

30-year term, my property taxes. This is where a lot of people, you get to this on many sites,

and you're probably thinking, where did I go from here? Let me show you a site, and I think it's

down below, if not, I'll post it down there. I posted all the tabs, but I think I forgot this one.

If you go to smartassets.com, backslash taxes. This is going to pop up. This is going to give you

what your real estate taxes in your area is going to be. Let's just go in here. This has already

popped up. Somebody must have just used it. Somebody's buying in Texas. Their zip code is 7301. This

is going to tell us exactly what your real estate tax code is or percentage. We're going to take that

number. We're going to go back to this. We're going to go in here, and we're going to put in 1.53.

Now you know that piece. Now you're going to get down to here, and it's going to say mortgage

insurance. If your credit is really bad, you're probably going to go with an FHA loan. Let's say

in this case, we're going to go with that case scenario, and that mortgage insurance can go

all the way up to 0.55. We're going to put in that top tier right through there. The HOA is if

you're buying a condo, something like that, put in the HOA. If it's a townhouse condo, something

like that, you'll know if it is. You'll put it in there. Let's just keep it for that for now.

Let's not say you're a veteran, and I don't want any other programs. I don't want any weird loans.

So what do I qualify for? Let me click it. Here's what I'm going to say right through here.

You qualify for a conventional loan. You qualify for an FHA loan. That's about it. Then it starts

going down through here. Well, based on this and that, but that's it for that category. But let's

get a dive in a little bit more. Let's say down through here, I am a veteran. I want to put in

that veteran. Well, let's also say, well, I can put down a little bit more. I can put down 5%.

This is going to open up a whole slew of other products, but let's go over to here. Let's change

this to a normal conventional loan at 6.12, I think, right now. We keep everything else the same.

Let's go down through here and say, okay, I want a little more aggressive parameters, like

loan to value. Maybe I don't have to put as much down. Maybe my debts can be a little bit higher.

I got a side gig. I'm making some cash. I can budget this thing. Let's click that as well.

Now, let's click this. Now, let's see what you're eligible for over here. It's going to say you're

eligible for conventional loans. Good credit. 3% down here. Let me see if you can see that behind me.

My apologies, folks. You can see right through there. It's going to give you that FHA. It's going to

tell you qualify for that. V8. It's going to tell you you qualify for that in high ends. It's going

to tell you basically every program right through there that you qualify for. Then if you really want

to start getting stretching things, you can go down below with some other things. This will help you

at least narrow down some of the basic programs that you qualify for. Now, if you're looking to buy

an investment property, you own your own business, things like that, that could get a little bit

different from these. Reach out to us. We'd love to help you. That's where now it's telling us,

okay, you could qualify and there's the programs you're going to qualify for. Now you're saying,

okay, my credit score is there. My budget's in line. I got three or four programs I qualify for.

Okay, so now I know the real estate taxes. You're also going to need to know what the homeowner's

insurance is going to be. So let me get to this last piece. I really want you to go to this and

figure out what your payment is going to be. So you don't have to drive your, you know, your

realtor crazy call, hey, what's the payment going to be on this house? What's the payment going to be

on that house? Just go to this category. The links down below and this one's free. It's right on my

website. Now let's let's put in your parameters. So you're going to say, okay, Dan, I qualified on

the last page with a conventional loan. I'm just going to put this in there. My home price, I'm

looking to buy is $430,000. I'm going to put 5% down. That's said, I could qualify with that.

The lead gives me a loan amount. This current rate today is 6.125. 30 or fixed. I'm going to close

whatever month you're going to close. That's a May. That PMI rate. Let's stick with the 0.55 that we

went over on the last page. Now the homeowner's insurance, your real estate taxes, you're going to

get all that from all the other tools we just used. So we're going to plug in my homeowner's

insurance. So this is for the years. Let's make it simple, make it $1,200. But here's where I really

want you to stop, especially if you're in Texas, California, Florida. What is your homeowner's

insurance going to be? That's a big question. If you're on the coast, it could actually make

homes completely unaffordable for you. So now halt a little bit. Reach out to a homeowner's

or whoever you have your car insurance with. Ask them, if I were to buy a $430,000 home in this

zip code, give me an idea what my insurance would be, then plug it in here. You might be shocked

because this thing, let's look at it, it's $1,200 a year. Okay, with taxes at 5,000 HOA, we'll

put it in no. Okay, go down through here. You know what your payment? 31, 3185. And this is,

this is pretty darn accurate because we all, we just plugged in all the data we know. But let's

just go over here. This is how dramatic it is. You might find out your insurance policies

5 grand. Let's plug that in. All right, I'll go back up here again. 31, 85. What is it now?

$3,500. That's a lot of money. Okay, can you afford it? Now, backload the data. Go back to your

budget. Does it work? Okay, are you comfortable with that payment? If you're not, start downsizing

some things. I'm not here to talk you into buying a house and I sure as heck don't want you to be

house poor. I want you to be able to get into a house that you can live and stand for years.

I just sold my mom's house, my mom and dad's house. My dad bought, I built it. He built it himself

when I was in third grade and I was, I'm 60 years old now. So that was a long time ago. And we

just sold it. And it was, you know, it was a blessing for us. So I, my parents, they were first

generation. Everybody was from Italy. And it was a goal of my dad to have no debt in the owner house.

And he was a steel worker for his whole life. And he ended up having a house that was paid off,

cars that were paid off and money in the bank. And he was just a steel worker, first generation

from Italy. And I hope I'm making dad proud up there right now doing what I'm doing. Because my

goal is to help you guys understand all this stuff. So let's get it. Let's get to a few more things.

And guys, please hang on with me. Carlos and some other people, I'd love to answer any questions

you got. But I just want to conclude because here's where I want to get back to.

What's that reach? You're going to qualify for. Okay. So this is where it really gets confusing.

Okay. So remember at the beginning, don't go to rate first. Let's figure out what do you qualify for?

Do you qualify for things and take it from there? So if you Google, what's my best mortgage rate?

And I just pop this up. It's going to come up with all this stuff. 30 or fix, five, nine, six,

this that what's the parameters behind this? Okay. And then you're going to get down here.

This is the, this is where you really get confused. And this is where my son at the one point,

he's like, Dad, hi, I have no clue now. And I'm like, okay, let me, let me help. You click into this.

Now you think you're going to bank rate.com. Here's what you're going to. It's all ads. They just

want to feed to the data. So then they can sell your data to these people. And let's see what's,

let's see if we can bypass this. Compare to, I don't know. I don't want to start getting into all

that stuff. But here, let's see what this says. 30 or fix, six. Okay. That, who is it with? Do I

click that? Or who's got the 30 or fix? Now, now what? Okay. Now, now where am I going? Okay.

That's so confusing. You get what I'm saying. But then you're going to get these rates that are

just out of the norm. So let me go back to my Sesame Street days. You ever look at a whole bunch of

pieces of a puzzle and just one doesn't fit. You got, you know, 15 pieces of fruit and then you have

a truck. It doesn't fit. So if you're ever looking at rates and you're like, that one doesn't fit.

Everybody else is at 6%. You got somebody at 3.99. You got to sit there and scratch your head.

The first interview I've ever had with Yahoo Finance, they called me and they said,

it was kind of intriguing of what I said. It was in, shoot, I just lost my adrenaline thought.

I forget what I was saying, but sorry, sorry for babbling along. One of the things I said on

there was pigs to get fat, hogs to get slaughtered, where a lot of people I thought were just,

you know, rates were going down, down, down, and down. And people just kept sitting there waiting

for the thing to go down. And I can't think of that Yahoo thing that I, it was the first time I was

on Yahoo Finance. And, oh, here's what I said. I said, you know, it's like this. When you see

something, it's like, it's like, I said, it's like me going past a gas station. You see that gas

stations, you know, gas is $3 a barrel or $3 a gallon. And then all of a sudden, you see this,

this place, it's a dollar. And it's like, how the hell are they doing a dollar? Well, then you

read the fine print. You got to buy four cases of beer and three pizzas and a case of this and

five, you know, three loaves of bread. Okay, that's why. When Yahoo Finance called me and they're like,

two, that was brilliant. And I was, I was just talking. So that's, that's what I was on there for. So

if something just doesn't fit, question it. That's all I ask. Okay, so let me, let me go to the last

piece of the puzzle. What should you do right now? Hi, this is Alex Cantrowitz. I'm the host of

Big Technology podcast, a long time reporter and an on air contributor to CNBC. And if you're like

me, you're trying to figure out how artificial intelligence is changing the business world

and our lives. So each week on Big Technology, I bring on key actors from companies building AI

tech and outsiders trying to influence it, asking where this is all going. They come from places

like Nvidia, Microsoft, Amazon and plenty more. So if you want to be smart with your wallet,

your career choices and meetings with your colleagues and at dinner parties, listen to Big

Technology podcast wherever you get your podcasts. Working across teams is tough,

but Asana helps you handle it. Asana AI can spot roadblocks and assign work to keep everything

on track. That's how work gets handled. Visit us at Asana.com.