Rent for 15 Years?

Summary

Summary of "Rent for 15 Years?" Episode of The Ramsey Show Highlights

In the July 23, 2025 episode of The Ramsey Show Highlights, hosted by the Ramsey Network, Danielle reaches out with concerns about a long-term rent-to-own housing program. The discussion centers around her financial situation, the viability of the program, and expert advice from Dave Ramsey and his co-host Chris. This summary encapsulates the key points, insights, and conclusions drawn during the episode.

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1. Introduction to the Housing Dilemma

Danielle's Proposal

Danielle begins by outlining her and her husband's consideration of a state-sponsored rent-to-own program. She explains:

"It's basically a rent to own program sponsored by the state. It is a 15-year term, and we cannot buy the home until the end of that term. But essentially all of our rent payments would go towards equity on that home." ([00:06])

She highlights their current financial standing:

• Debt: Approximately $6,000
• Emergency Fund: Nonexistent, as funds have been allocated to their new baby

This places them in Baby Step Two of Dave Ramsey's financial plan, which emphasizes paying off debt.

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2. Expert Analysis: Dave Ramsey's Response

Strong Advisement Against the Program

Dave Ramsey responds promptly, expressing strong skepticism about the 15-year rent-to-own model:

"I would not do this. No, no. Not under any circumstances would I do this." ([00:45])

He underscores the inherent risks and long-term commitment of the program, advising Danielle to prioritize financial stability over immediate housing solutions.

Key Points from Dave:

• Debt Elimination: Emphasizes the importance of eliminating debt before committing to long-term housing.

  "I would get out of debt. I'd build an emergency fund. I'd start saving for a down payment on a house." ([00:45])

• Unpredictability Over 15 Years: Highlights the unpredictability of life changes over such an extended period.

  "Too much happens in life. Crap. The roof on the thing will be 15 years old. The dishwasher will be 15 years old." ([01:31])

• Skepticism About Program Completion: Expresses doubt that Danielle and her husband will stay in the program for the full term.

  "I give you a 100% chance you never close on it. You're not going to stay there 15 years." ([01:31])

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3. Additional Insights: Chris Weighs In

Questioning the Rationale

Chris probes deeper into Danielle's reasoning for choosing the rent-to-own route:

"Why did you guys decide this and not just have a mortgage and build equity on your own? And why are you guys using this program?" ([02:09])

Addressing Financial Readiness

Chris aligns with Dave's perspective, emphasizing the importance of financial readiness before homeownership:

"There's a reason these programs exist, Danielle. It's because people are not in good financial situations to buy houses." ([03:43])

He advocates for a more traditional approach to home buying, suggesting that Danielle and her husband could be in a stronger financial position in a few years.

Lifestyle Considerations

Chris also touches upon the lifestyle and financial pressures in cities like Salt Lake City, implying that settling into a long-term rental program might not be advantageous given the region's economic dynamics.

"Salt Lake City, it's kind of become a like a small little LA. The amount of lifestyle and wealth and keeping up outside of that city is pretty unbelievable." ([04:12])

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4. Danielle's Current Financial Efforts

Building Savings Amidst New Parenthood

Danielle elaborates on their financial struggles, particularly after having a baby:

"We were building a savings account and trying to save up money, but we had a baby, so all of our emergency funds went to paying that down. And we're still kind of working on that." ([02:22])

This context underscores their vulnerability and the need for a robust emergency fund before making significant financial commitments.

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5. Concluding Recommendations

Prioritizing Financial Stability

Both Dave Ramsey and Chris strongly discourage Danielle from committing to the 15-year rent-to-own program. Their collective advice includes:

• Debt Clearance: Focus on eliminating existing debts.

  "You get that last 6,000 cleared, you build the emergency fund, and then you go buy. You start saving for a house." ([02:25])

• Emergency Fund Establishment: Build a safety net to handle unforeseen expenses.

• Saving for a Traditional Mortgage: Instead of a long-term rental, save for a down payment to secure a mortgage sooner.

  "House in four years, that's 11 years sooner than the plan." ([03:27])

• Avoiding Long-Term Commitments: Reiterates the uncertainty and risks associated with a 15-year rental agreement.

  "Please don't sign up, but don't sign anything else. Just don't do it at all. Please don't do it." ([02:46])

Encouragement for Financial Growth

Dave concludes by motivating Danielle to visualize a more financially secure future by delaying the rent-to-own program:

"How do I visualize 33-year-old Danielle in her best life? It's not 10 years into a 15-year rent program. I can tell you that." ([02:46])

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6. Final Thoughts

The episode serves as a cautionary tale against long-term rent-to-own agreements, especially for individuals still in the early stages of financial building. The experts advocate for:

• Responsible Financial Planning: Prioritizing debt elimination and emergency funds.
• Strategic Savings: Allocating funds towards a traditional home purchase.
• Avoiding Financial Traps: Steering clear of programs that may seem beneficial short-term but detrimental in the long run.

By adhering to these principles, listeners are encouraged to achieve financial stability and secure homeownership without undue risk.

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Notable Quotes:

• "I would not do this. No, no. Not under any circumstances would I do this." — Dave Ramsey ([00:45])
• "You're not ready yet. You're not ready yet." — Dave Ramsey ([03:50])
• "Salt Lake City, it's kind of become a like a small little LA." — Chris ([04:12])

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This episode underscores the importance of sound financial strategies over long-term, restrictive housing programs. By following Dave Ramsey's proven steps, individuals like Danielle can work towards owning a home without compromising their financial security.

Transcript

[Dave Ramsey]

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[Danielle]

My husband and I, to keep it short and sweet, we applied for this program. It's basically a rent to own program sponsored by the state. It is a 15 year term, and we cannot buy the home until the end of that term. But essentially all of our rent payments would go towards equity on that home. My holdup is that we'll be basically renting for 15 years, and we are only in baby step two right now. So we don't have an emergency fund, but our debt is only like $6,000, so not a ton.

[Dave Ramsey]

Okay. I think your holdup was, you know, was a good analysis. I would not do this. No, no. Not under any circumstances would I do this. No, I would get. I would get. I would get out of debt. I'd build an emergency fund. I'd start saving for a down payment on a house. No, I would not rent for 15 years on purpose.

[Chris]

Yeah. So much changes, Danielle, in 15 years. If you think about it, life, I mean, it's just crazy. Think about 15 years ago for you, right? I mean, just. It is. And to be locked into something, if.

[Dave Ramsey]

You never close on it, 100% of the money went to rent for 50.

[Chris]

I mean.

[Danielle]

Well, I mean, our rent payment right now would be the exact same.

[Dave Ramsey]

If you never close on it, 100% of it went to rent. I'll give you 100% chance. You never close on it. You're not going to stay there 15 years. Too much happens in life. Crap. The roof on the thing will be 15 years old. The dishwasher will be 15 years old. Stuff's gonna start breaking left and right. That's if it's brand new when you move in it.

[Chris]

Danielle, why did you guys. Why did y'.

[Dave Ramsey]

All.

[Chris]

Why did y' all decide this and not just have a mortgage and build equity on your own? And why. Why are you guys using this program?

[Danielle]

Well, we were building a savings account and trying to save up money, but we had a baby, so all of our emergency funds went to paying that down. And we're still kind of working on that.

[Chris]

Yeah, good.

[Dave Ramsey]

Yeah, I love it. So you get that. You get that last 6,000 cleared, you build the emergency fund, and then you go buy. You start saving for a house. How old are you?

[Danielle]

23. And my husband's 24.

[Dave Ramsey]

Yeah, please don't do this.

[Danielle]

Well, the thing is, we can get out of the rent program. We're not signing for 15 years.

[Dave Ramsey]

Don't. Don't sign up, but don't sign anything else. Just don't do it at all. Please don't do it. It's not good. It's not good for you. You called nass. I'm gonna tell you the truth. How do I visualize 33 year old Danielle in her best life? It's not 10 years into a 15 year rent program. I can tell you that.

[Chris]

You could be so much better off, Danielle.

[Dave Ramsey]

Yeah. You'll be so much better off at 33.

[Chris]

Yes. I mean seriously, think about it. It's gonna take you guys a couple years. Don't rush into a house. You guys are fine. You got time, rent, get yourself in a position and then actually start building money for you like as you guys start when you finally buy a house for you guys, if you buy a.

[Dave Ramsey]

House in four years, that's 11 years sooner than the plan.

[Chris]

And people are paying off their homes in seven to nine years using this program. So you could have a paid off house, completely yours before this.

[Dave Ramsey]

Before you would even be buying this other one.

[Chris]

Yes. Yes.

[Dave Ramsey]

No, no, no, no, no, no.

[Chris]

There's a reason these programs exist, Danielle. It's because people are not in good financial situations to buy houses. So don't buy a house. It's you guys.

[Dave Ramsey]

You're not ready yet. You're not ready yet.

[Chris]

I think all the lights are flashing.

[Dave Ramsey]

You got plenty of time to do this. Please, please don't do it. Please don't do it. Your instinct when you. The wisest thing you said is the thing that's bothering me is I'm going to be renting. And that really, really, really means a lot. It should be bothering you.

[Chris]

And this may not be the case, but I'm gonna say it out loud cause I see it. Salt Lake City, it's kind of become a like a small little la. The amount of lifestyle and wealth and keeping up out of that city is pretty unbelievable. So like, I don't know if there's any level of comparison, Danielle, of what you're living in is everyone's like just doing really well around you. I don't know. But I see more and more of that really coming out of Salt Lake. Yes.

[Dave Ramsey]

No idea.

[Chris]

Yes.

[Dave Ramsey]

I should get out more. Create your free every dollar budget today. The simplest way to budget for your life.