Is 2025 the Right Time to Buy or Sell A House? with Dale Vermillion

This faith and finance podcast is underwritten in part by Movement Mortgage. Movement provides residential home loans in all 50 states. Founded in 2008, amidst one of the biggest financial meltdowns in American history, Movement set forth on a mission to create a movement of change in their industry, in corporate cultures, and in communities. So that a portion of their profit creates a long term positive impact in communities, both close to home and around the globe through the Movement Foundation and Movement Schools. It all comes back to their mission to love and value people.

Learn more at movement.com slash faith. The real estate market may be in its winter slump, but spring is just around the corner only five weeks away. Hi, I'm Rob West. Higher interest rates have left many homebuyers and sellers stuck on the sidelines in recent years.

But could it change beyond the horizon? Today mortgage expert Dale Vermillion joins us with a market forecast and some practical advice on moving forward. And then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is faith and finance, biblical wisdom for your financial decisions. Well, our guest Dale Vermillion is the author of The Mortgage Maze, the simple truth about financing your home.

He's a frequent contributor on the program. Dale, great to have you back. Rob, it's always an honor to be here. Thank you so much. Happy New Year.

Good New Year to you, my friend. Hey, I mentioned that folks have been in a stay put mode for a few years now due to high interest rates. I know this is front and center.

And what you do is you train tens of thousands of mortgage brokers across the country. Give us your perspective. Is this about to change? Well, we think so. You know, they call it the lock in effect, and we did see existing home sales increased by 6.1% in November. That's the last report we had December I know was slow. And January typically is what we've got the March season coming. And February when we start to see things increase and consumer confidence we are seeing is increasing all reports. And I think consumer patience is probably decreasing.

People want to get in the home. So I think we're going to see some movement and some growth in the next year or two. Yeah. Well, you know, you can put off a move for a period of time, but at some point, you just got to go, right? I mean, you can't put your life on hold. And so we're probably going to see more and more people getting to the place where they say, All right, I'm just gonna have to go ahead and, you know, accept these interest rates where they are and expect to refinance maybe in a couple of years. Is that the way people are thinking? You know, I think it is the way that they're thinking. But the fact of the matter is, it all comes down at the end of the day to what your payments going to be what you can afford. So when you're thinking about, you know, I need to move, I've got to make that decision, just make it wisely, like we talked about all the time, make sure you do a budget, make sure you determine what you can afford.

Yeah, very good. Let's talk about the Fed. Of course, rate cuts have disappointed a lot of people, and mortgage rates tend to lag far behind them anyway. And now we're hearing that perhaps it's even in question, whether we'll get any more rate cuts this year, what say you?

Yeah, it looks like we might get one or two, probably not more than that. Look, after listening to the inaugural address, the thing that's going to move mortgage interest rates is going to be more than that. And so we're going to see more and more people getting to the place where they say, All right, I'm just going to have to go ahead and make that decision, just make it wisely, like we talked about all the time, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget, make sure you do a budget. We're grateful for support from Movement Mortgage, who provides residential home loans in all 50 states. Guided by a mission to love and value people and a goal to redefine the mortgage process, Movement seeks to help others achieve their financial goals. You can find out more at movement.com slash faith. Movement Mortgage LLC supports equal housing opportunity in MLS number 39179.

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I'm Rob West. Well, it's just about time to take your calls and questions here in just a moment, but we do have some lines open right now. So if you have a question, go ahead and give us a call at 800-525-7000. We will dedicate the remainder of the broadcast to you and take those questions, whatever you have for us, 800-525-7000.

We're going to begin in Spokane today. Hi, William. Go ahead. Hey, Rob. Thank you for taking my call.

Of course. Thirty-second just kind of backdrop of where I'm at. So I'm 37. I have a family of five. I have four children.

They're all young, twin six-year-olds, three-year-old and a newborn. Three years ago, we bought some property and we've been working it. And we've been doing everything by cash. So I built a small cabin on the property that we're living in while we're building the permanent structure. So far, I have the foundation, the frame up and a temporary roof. This year, I have the capital funds for the trusses and the roof.

But after that, it comes electrical and plumbing and everything else. And I've looked into HELOC and I've looked into HELs and land equity. I've looked into construction loans. Everybody is okay with giving me money, but I'm not okay with giving them three times the amount after 15 years or 30 years. So I just kind of wanted to know what, I have some people say, yeah, just get the loan and get it done and be done with it. And then I have other people that say, no, man, wait three more years and you can do it with cash and you'll be debt-free. And I just kind of want to know what your thoughts are on that.

Yeah. I mean, you know, Hey, here's the reality is it would be best if you could wait and cash flow this, but there are trade-offs to that. And so the question is, are you in a financial position? Meaning you can cover the debt, you're not getting overextended and you're willing to pay the interest in exchange for getting this project done a little quicker and being able to access it and enjoy it versus just your conviction of remaining debt-free and just the financial wisdom in trying to save that money that you could put into additional giving or saving for the future and exercise a little delayed gratification. And I understand when it comes to, you know, building a property, a new house, that's going to be your permanent residence. You all may want to get in it sooner rather than later and be able to enjoy it.

None of us are getting any younger. And so, you know, there's also the potential that building costs could be a little bit higher down the road. Probably not likely we already saw that spike and we're seeing building costs kind of level off. You know, we're well beyond the supply chain issues from the pandemic that resulted in a spike, but is it possible that things could cost a bit more, you know, two or three down years down the road when you're able to cash flow on your own without any debt, these additional expenses around plumbing and electrical?

That's certainly possible. So I think this is really just at its core, just like every financial decision, a values conversation. What's most important to us? There's nothing wrong with wanting to get into the house and enjoy it and being willing, as long as you're able, to, you know, take on some additional expense by way of interest in order to do that. There's also nothing wrong with you saying, you know what, I can do this and I can wait it out. And, you know, my wife and I are on the same page and we've got a big family and, you know, we've got young kids, but this is really important to us.

This is a conviction. And when we think about our values as Christ followers, this is just something that we would like to be able to do. We'd like to be able to kind of wait this thing out and do it on our own and kind of muscle through it.

And so I don't think you can go wrong on either of those. I think you just need to come together as husband and wife, be sure that you've heard each other and that if either one of you have a real conviction one way or the other, I would listen to that, especially if the other one could kind of go either way. I would make it a matter of prayer, invite God into that and ask him to give you a complete peace and some wisdom about the step forward and then make your decision and don't look back. And, you know, just like you said, despite the fact that the banks are willing to give it to you, doesn't mean that's necessarily the right move for you. But again, I wouldn't fault you if you said, you know what, we're not getting any younger, we want to get settled in this new house, we're excited about it, our kids are growing up, you know, we're just going to go ahead and borrow the money and get this thing done.

I don't think that's a bad decision, but I would really think and pray through it. Is that helpful at all? Yeah, I know that's kind of where I'm at. I'm 50-50, and so yeah, the conviction is strong on waiting and being free and continuing to be free so that I can have that kind of time leverage with my with our lives. Yeah, yeah.

Yeah, that helps. And what about with your wife? Is she sensing the same thing or is she in a kind of a different place on this?

Yeah, we spoke about it last night. We've talked many times about it and she says the same thing. She's like, you know what, if you want to wait it out for the next three years, we can do it. You know, if you want to cut a loan, I support you in it too. We both want to get in, but we're both able and willing to kind of hold off for a little while longer.

Here's what friends in the area that have done the same thing. Yeah, well here's what I would say. Don't dismiss that conviction that you have.

Perhaps maybe take another week and maybe you each agree independently to pray it through and then come back together, but in the end of the day, I think you're headed in the right direction. Thanks for your call. North Carolina is where we're headed next. David, go ahead, sir. Hey, Rob. Thanks for taking my call.

Yes, sir. So I am 56 years old and I am about, I'm a state employee and about to take early retirement. I'll end up with my healthcare covered and a modest pension of about $1,400, but I'm immediately going back to work in the private sector, making more than I am now actually. So my question is, do I take that pension money and invest it in another qualified retirement account for when I do retire? I plan to work at least 10 more years. Or do I use that money to pay down debt, which the only debt I have is a 6% mortgage and a 7% home equity line of credit. Okay. How much do you have on the HELOC and how much on the first mortgage?

First mortgage is about $148,000 and the HELOC is about $11,000. Okay, got it. And based on you going back to work in the private sector, are you going to have enough to cover your bills and a little bit left over? Absolutely. Again, I'll be making actually more than I am now.

Okay, got it. Yeah, I would leave that retirement plan alone and roll that out into an IRA, keep it in a tax deferred environment so you're not paying any tax on it. Let it continue to grow on a tax deferred basis and then just focus on redirecting, you know, whatever surplus you have by going back to work after your bills are paid toward initially paying off that HELOC and then going after the first mortgage. But I would not pull that money out of the retirement plan to do that. I'd let that keep growing.

You know, you're not going to have any impact of taxes that's going to slow that growth. And then if you could position yourself just by really keeping your lifestyle, you know, a cap on it, and redirecting all of your surplus to getting out of debt, you know, by the time you transition fully into what God has for you next, even if it doesn't involve paid work in the next season, hopefully that's eliminated, you know, your biggest expenses. And now you've got, you know, Social Security and, you know, if at any point you want to start pulling, you know, a monthly income from your retirement plan, you could, but your expenses are probably a good bit lower because you're debt-free at that point. I think that's the better plan in my opinion. Okay. All right. Well, that sounds great. I certainly appreciate the advice. Absolutely. One other thing is once you're 70 and a half, you would be able, and I realize that's a good bit down the road, but, you know, if you got to the place where your bills were covered without the IRA, you could, you know, pull that money out as a qualified charitable distribution, do the giving that you were already doing out of after tax dollars from your IRA and never pay tax on it because it went in tax deferred, and then it comes out tax-free.

What an amazing opportunity for you to, you know, to have never paid tax on that money and get it into circulation in the kingdom. So hopefully that helps you, David. We appreciate your call today. Lord bless you, sir.

Hey, a quick break, and then back with more questions after this 800-525-7000. Are you searching for a way to become a better faithful steward of the resources that God has given you? Well, download the Faithfi app and join the 37,000 others who are already using our app. The Faithfi app will provide you with wisdom, community, and simply help you stay on track with your finances. We have three money management options to choose from, so find an option that fits your unique needs.

It's available on desktop or mobile. Simply go to faithfi.com and click app to get started. As the leading advocate for the Christian financial industry, Kingdom Advisors serves the public by promoting the integration of a biblical worldview across every aspect of the financial services industry. And we serve a growing network of thousands of Christian financial professionals, equipping and empowering them to carry biblical financial wisdom to their clients, peers, and community. For more information, visit kingdomadvisors.com. That's kingdomadvisors.com. Hey, thanks for joining us today on Faith in Finance.

We're going to head back to the phones here in just a minute. All the lines are full here today, but we're just launching—in fact, they just went out in the mail to all of our Faithfi partners—our brand new publication, Faithful Steward. It's a quarterly publication. It's beautiful.

It's 52 pages. Incredible articles just helping you connect faith and money for God's glory. But one of the articles in this first edition of Faithful Steward is an article by my friend David Wills, president emeritus of NCF, talking about aligning your giving with God's heart. And here's what David unpacks.

I love this. In terms of thinking about your giving, you know, we all have a maybe an investment policy statement on how we're going to invest God's money. But with regard to giving God's money, what framework do you lay over your giving in terms of the where of giving?

Well, David looks at both geography and people. So where are the places physically I'm going to give? And then ultimately, you know, what are those causes or areas that are also on the heart of God? Well, in terms of the places, he says we should look locally, nationally, and internationally.

And he refers us to this passage in Acts 1-8 where Jesus instructs his disciples to be witnesses in three areas—Jerusalem, local, Judea and Samaria, regional, and the ends of the earth, international. What about laying that geographical framework on top of your giving as we think beyond just our immediate surroundings? And then as we move beyond that, we also look to the priorities that are on the heart of God. And David talks about the three greats.

Think about this. The Great Commission, go into all the worlds and all the world and proclaim the Gospel. And so we need to be thinking about how we're giving to the spread of the Gospel. Gospel work to the ends of the earth.

That's the Great Commission. The greatest commandment was, you remember from Matthew chapter 22, Jesus says, love the Lord your God with all your heart, your soul, your mind. So that's giving to preaching and teaching and discipleship. And then he goes on to say, and David calls this the great compassion, he says, this is the first and greatest commandment. The second is like it, love your neighbor as yourself. What does it look like to love your neighbor as yourself?

Well, I think that's the poor and the oppressed, among others. You know, God expresses special concern for the poor and the vulnerable, particularly within the Christian community. So we're called to care for orphans and widows and the hungry and the sick and others in need. So perhaps as you think about your giving, use that framework, both the geographical, as well as those causes and areas that are on the heart of God that we see in his word. By the way, if you want to be sure you get Faithful Steward, our new publication in the mail each quarter, just become a FaithFi partner. It'll be a real blessing to us as you help support the ministry, but you'll also get this publication each quarter and all of our new studies and devotionals pre-release before they come out to everyone else.

Just go to faithfi.com and click give. Let's head back to the phones. Ohio is where we're going next. Hi Maxine, go ahead. Hello, I am just finishing a messy divorce and I have about $200,000 to invest, but I am 76 years old. What do I do with this? Yeah, so before we talk about investing Maxine, and I'm so sorry to hear about your divorce, are there other priorities that you have, namely any debt that you need to pay off, or do you need to hang on to any of it to kind of shore up what I call your emergency fund that might go into savings for the unexpected, or do you feel like all that's covered? No, I have no house payment, no car payment right now, credit card debt, very, very slim, and part of this is savings too. So right now it's in a high interest savings account.

Okay, excellent. Yeah, so you may just want to think about in terms of maybe six months worth of expenses at a minimum would be the portion that you want to make sure stays in that high yield savings. If you don't have other savings, and we'll call that your emergency fund. So that way, you know, if the bottom fell out, or you, you know, had some major unexpected expenses, you've got six months worth of expenses sitting there ready to go, you may want to go more than that.

But I would say that at a minimum. Beyond that, in terms of how to think about investing this, you know, even at 76, I mean, if you're in good health, we still need this money potentially to last for two decades or more. And so we don't have to be, you know, just put it all in, you know, bank related products, I think there is still a case to be made for putting a portion of it in stocks, and probably the larger portion for sure in what we would call fixed income. So think CDs and bonds, maybe US Treasury bill bonds and notes, you know, high quality corporation, bonds, corporate bonds. So I think in terms of the high level allocation, at 76, you probably want to be thinking about a 70 30 portfolio 70% of whatever portion you're going to invest beyond your emergency fund in fixed income, and 30% in stocks, you could go as low as 20%.

But I think that's kind of the high level now in terms of which bonds and which stocks. Well, that's where I think a certified kingdom advisor could be really helpful to you, Maxine, there's some wonderful ck's there in Ohio. So if you're comfortable using the web, go to faith fi.com faith fi.com, click find a professional, I'd interview two or three if you're not stay on the line and our team will see if we can get you connected directly. Thanks for your call. Let's go to Yvonne in Cleveland. We'll you'll be our final caller. Go ahead.

Well, thank you, sir, for taking my call. Long story short, 2019, we had 200,000 in our savings, COVID came and life circumstances illness came and now we are maintaining 500,000. We're bringing in 65,000, roughly that with my husband and myself.

He's 57 on 54. And just want to know a plan to how do we start over? Yeah. So you said you had 200,000? What's the value of that investment account today? Well, it's depleted.

We had to take out our IRA, we had to take out all of our retirement. Got it. Okay.

So your combined income now is 65,000. That's correct? Yes. And what do you do you have any investable assets? Are you starting from scratch? We're starting from scratch. Okay. Do we have any savings, any liquid savings, just emergency reserves? No, everything is gone.

A lot of things happened. Sure. Yeah, no, I get it. And I know that can be challenging. So what is in, you know, you're checking right now just enough to cover this month's bills? Are you all living paycheck to paycheck? We're bringing in 65 and we're basically at the end of every month, we're maintaining 500. Okay. And that's across five bank accounts. So when I say we've, we need to start over, we have retirement and both of our accounts are 25 a piece. So that's 50,000 that, you know, that's for our retirement or for our best life insurance. Yeah.

Okay. So here's what I'd like to do. I'd love to offer you, if you'd be willing to take advantage of it, one of our certified Christian financial counselors to get on the phone with you and your husband, you know, your husband, uh, over a series of phone calls and help you put together a budget. Cause the key for you guys in starting over is to dial back your spending.

So you can create more margin so that you can fund those retirement assets over the next decade, uh, stay on the line. We're going to get your information. We'll cover the cost to get one of the CERT CFCs to call you and see if they can work through it with you. This is faith and finance grateful for my team today and grateful for you. Thanks for being with us. We'll see you tomorrow. Faith and Finance is provided by Faithfi and listeners like you.