This is part two of my interview with Shani Curry-St. Vil. Click here to view part one.
When we talked about real estate in our last episode, Shani and I received a ton of questions from our listeners and readers. So, we decided to do a part two where I asked Shani all of the questions that we received and she answered.
What tips do you have for homeowners that want to invest in real estate and own their own home?
Shani recommends not writing off all of your income as a business owner. For example, if you bring in $85,000, but write off $30,000 of it, your qualifying income then drops to $50,000. The banks do look at your income, or the money that you’re bringing in as a profit, so to qualify for a home in your area, you need to at least be making an income that shows you can pay your mortgage.
Shani also says that you will want two years of proof for your income, taxes, and proof that you’ve worked for two years in the same industry. If you’ve owned your business for two years and can prove it, you have a better chance at qualifying for a loan.
What mistakes do millennials make when buying a house?
Shani says that when millennials (and other generations) invest in real estate and try to buy a house, the number one mistake is that they try to buy more than they can afford. Instead of looking at the house as an investment, they try to buy a home that is perfect, but they typically bite off more than they can chew.
Another mistake that millennials make when buying a house is not adding up all of the home owning costs. Between repairs, insurance, and a mortgage, your costs as a homeowner are higher than what you may see at first when just looking at a mortgage.
Other mistakes in real estate include picking the wrong realtor, not using grants or assistance to your advantage as a new homeowner, and not paying attention to your paperwork.
Do you actually need an agent to buy real estate?
Shani believes you don’t need an agent, but also believes that an agent can save you time, money and resources in the long run if you choose the right one. Shani recommends doing some research on real estate and buying a home so you have the knowledge to leverage with sellers if you don’t want to use an agent.
What are some red flags to look for when working with a realtor?
Shani says the number one red flag is that the conversation isn’t fluid. If you can’t explain a conversation with your realtor to your friend, that’s a red flag. Also, if a realtor never answers the phone, or calls you back in a timely manner, that may mean they have too many clients or aren’t full-time, so they may not be able to attend to your needs.
Does buying an unlisted property make financing the sale hard?
Shani says that it’s actually the opposite. Buying an unlisted property could be easier to do because you won’t have to deal with a lot of competition. It also helps if you are able to purchase the property in cash, because you don’t have to deal with making sure everything is inspected and up to code (if you don’t want that).
What is one financial tip you have that could help the readers improve their finances right now?
Shani recommends having a no spend month at least once a year. Write down all of your necessary expenses, and then make a plan to not spend money other than on those. Take the extra money and put it into savings!
How do you make money your honey?
Shani makes money her honey by buying real estate and being selective on how she spends her time earning money.