January 16, 2022 • 39 mins
This week on "Create. Build. Manage." I talk with Debbie Bloyd, host of "The Dollar Diva with Debbie," about increasing interest rates, refinancing your house, and taking money out of your house to start a business.
Connect with Debbie Bloyd:
https://www.linkedin.com/in/debbie-bloyd-419b168a/
https://biztalkradio.com/the-dollar-diva/
https://dlbmortgageservices.com/
Connect with Scott Miller:
https://www.facebook.com/scottmillerceo
https://www.instagram.com/scottmillerceo/
https://twitter.com/scottmillerceo
https://www.linkedin.com/in/scottmillermedia/
Connect with Debbie Bloyd:
https://www.linkedin.com/in/debbie-bloyd-419b168a/
https://biztalkradio.com/the-dollar-diva/
https://dlbmortgageservices.com/
Connect with Scott Miller:
https://www.facebook.com/scottmillerceo
https://www.instagram.com/scottmillerceo/
https://twitter.com/scottmillerceo
https://www.linkedin.com/in/scottmillermedia/
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:10):
Welcome to Create, Build, Managethe Entrepreneurs Toolbox. Here's your host,
Scott Miller, and welcome to anotherepisode to Create, Build and Manage.
I'm Scott Miller. I hope you'rehaving a great January thus far. Today
we're going to talk about things thatare going on in business, of course,
(00:30):
and specifically what's going on with inflationand how that could mean higher interest
rates. I want to welcome toour show our resonent real estate expert.
She is the dollar Diva herself,Debbie Bloy. Debbie, welcome to the
show. Hi, thanks so muchfor having me. Oh, it's always
a pleasure. Debbie is when Isay you're a resident real estate expert.
(00:54):
She has a show on her sisternetwork, Busin Talk Radio that airs weekdays
at seven am and ten am EasternTime. You can find that show in
BizTalk Radio dot com or listen toher on the BizTalk Radio app. But
as you can see from your logobehind you, you're not just a pretty
face for radio. You also haveyour own business. You are the owner
(01:15):
and broker of DLB Mortgage Services.Now, when I talk about interest rates,
Debbie, this is something that Iknow is talked about a lot in
the world of real estate. Isthe interest rate going to go higher?
We always talk about that, butnow it's a real possibility. As a
US government looks for ways to getthe inflation under control, one of those
(01:38):
leverages they can pull is raising theinterest rate. And what I'm reading in
the trades is that something that's goingto happen, perhaps as early as March,
maybe even late February. What areyou hearing It already happened. It
happened for the first time. Soit happened between last week and this week.
We're up three quarters of a point, which doesn't sound like a lot,
(01:59):
but on a four hundred thousand dollarsloan, that could be two to
three hundred dollars a month. Soit is a real thing. It's happening,
and I don't think it's going tostop. It's only going to go
up from here. So this isjust the beginning. So it really gets
into when we talk about why theywould raise interest rates. Let's kind of
unpack that because I think it's importantfor people that may not understand when I
(02:23):
talk about it's one of the leveragesthat the government can pull. So we
have this inflation, which is allabout demand. There's a huge demand out
there, and we economics one onone, particularly in a capitalist you know
economy, like we have, themore demand you have to hire, the
price gets. So why raising interestrates? That kind of slows down the
(02:45):
demand, right, not just forhousing, but for a lot of things,
you know, it does, Scott, and that's what they're hoping to
do right now. We can't catchup. We cannot catch up to build
enough houses. We can't get enoughlumber, we can't get enough windows or
flies, and so this is goingto slow it down. But actually,
you know, it takes the lookersout of the business. And it's only
(03:07):
really the serious people. But thereare people that have to move, whether
it's for their job or for familyreasons. So people aren't just willy nilly
picking up everything and spending a lotof money moving. They're doing it for
purposes. And this is going tonot only slow that down, but it's
going to cost the consumer more.It is going to cost a lot more.
(03:28):
And what's interesting about that is onthe surface, again, if you're
not a student of the economy,you may think this is a bad thing,
and there certainly are some negative things, right Debbie I mean, if
you are trying to refile your house, if you're trying to close on a
home, higher interest rates equals thousandsof more dollars you're going to spend over
the lifetime of your loan. Right, But there is some positive to it
(03:51):
as well, is there not.Yeah, So if you own a home,
you have got the benefit of inflation. These last I don't know,
six months, eight months a year, so your house has probably gone up
in value here in the Dallas FortWorth area at least twenty percent. So
for a lot of people, theylove this because now their house is worth
(04:13):
more. If they do a cashout refinance to pay off some bills,
they're going to take that equity outof their house. They're going to have
the equity they didn't know they hadbecause now their house is worth twenty percent
more. That frees up a lotof money. Now, some people say
this is pretend money. It's realmoney when you take it out of the
equity of your house. If youleave it sitting in in your house,
it just looks pretty on paper,but it is real money, and real
(04:38):
people are coming in with real cashand we're buying up real estate here in
the Texas area. Well, it'sit's in Texas, and it's true in
other parts as well as across theUS. So let's talk about that because
there's you know, when is thetime to do a cash out refly.
(04:58):
So if you are an into visualand you have a home, and I'll
tell you my situation. We boughtour home five years ago. I'm also
in the Dallas Fort Worth area,and we've watched the value of our home
increase. I mean, it's justit's almost shocking what the what the value
of the home is now now believeme, come tax time it's also shocking,
(05:18):
which is a whole other story inTexas when you're paying side right.
Yeah, yeah, But what wouldyou recommend I mean, or what are
some good reasons why someone would wantto do a cash out REFI and in
essence add more debt to their home. Well, it depends on what your
(05:39):
financial picture looks like. So whatwe do, because I do more than
just real estate and finances, Ikind of look at the holistic approach of
who you are and what you have. A lot of times people are using
their house as a cash register toredistribute their wealth. So you're making a
job and you have a job.Maybe your job makes more, maybe your
(06:00):
debt your self employed. But youhave kids. If you have kids,
you've got bills. So whether you'repaying for college, buying cars, you
and your family get a car.Now you've got some more debt, Well,
that interest rate, you're gonna wantto redistribute your money to where you're
not wasting it on interest that youdon't need to. So if you have
(06:21):
high interest rates credit cards, ifyou've got student loan debt for you or
your kids, If you owe acar nodes and you can borrow against your
house at three and a half percentand your car notes at six percent,
take the money out of your house, pay off your car. If you
can pay off student loans, doit. If you can pay off eighteen
percent interest rates on your credit cards, do it because now you're saving money.
(06:45):
You're spending the same amount, butyou've mooshed it around a little bit
to where it's more advantageous to you. We still get to write off interest
on our mortgage. We don't getto write off interest on our credit cards.
Now that could all change, butright now, this tax here,
we still get to write off thatmortgage interest. So you're redistributing your wealth
to better benefit you in your situation. It changes all the time. That
(07:12):
is absolutely brilliant, And I justwant to take a moment to really kind
of unpack that because, and Idon't know why this is, but the
interest rate on homes always seems tobe lower than the interest rate on the
car, certainly lower than the interestrate and that revolving credit line you have
on your credit card. Why isthe interest rate always better on homes,
(07:33):
which is arguably a larger purchase.Probably the most expensive thing you'll buy is
your home, versus the interest rateon these other purchases. Well, you
know, the bank owns your car, and they can come and get it
if you owe on it, andthat's call a repossession. They can foreclose
on your house, but just thinkabout it. Your house. They give
(07:55):
you a lot longer to pay itoff, thirty years, and sometimes there
are loans that go up to fortyyears. There are interest only loans.
They're doing everything they can to makeyou have home ownership. So some people
need a thirty year mortgage for aforty year mortgage. Some want to pay
it all fast. It's all inmanaging debt. But you or I could
not afford to go out and paycash or leverage a four or five hundred
(08:16):
or eight hundred thousand dollar house infive years. So this puts it in
bite sized pieces. And this ishow the mortgage business started a long time
ago, bite sized pieces so thatwe could afford it, and the banks
could leverage the money that they haveto make money. So it's kind of
a win win for everyone. Now, that absolutely makes sense. And so
(08:39):
when you look at your interest rates, you know, again I just look
at my personal experience. Right,we have a used car, we bought
a guarantee. You interest rate isprobably twice what it is on our home.
We still have those lingering student loansbecause my wife and I met at
a private Christian school. Hello,we still have Yeah, we still have
(09:00):
them, and we've we've got aline of credit that we're paying off some
other things. So you know,in our case, and again I'm just
using our example, it would bewise to take that extra equity we have
in our home roll that dead inthere. And the one benefit you said
that I've never thought about, Like, I get the idea of the lower
interest rate, but it's the taxbenefits that never really clicked in my mind
(09:22):
where every year we get a lotback on income tax because of child credit
and because of the equity or theinterest we're paying on our on our mortgage.
Right, Well, what happens,Scott is a lot of people don't
put all of their people in aroom. So like my people, my
people are attorneys, CPA's financial advisor'smortgage people. You may not have a
(09:46):
CPA, Well then you if youdo turbo tax or something on your own,
you're not going to know how tomaneuver money. So it takes all
of us together as like little villageto get you through the finish line.
And everyone has a different opinions,so it really does take you talking to
your CPA, talking to your financialperson, talking to your mortgage person to
(10:07):
figuring out how to get you inthe best position. I had a girl
yesterday call me. She is incollege, she has money saved up,
and she was I think I thinkshe got an insurance claim of some kind.
So she has about one hundred andfifty thousand dollars and she's twenty four
years old. She wants to buya house to live in instead of rent.
(10:28):
So she's like, you know,miss Debbie, I would really want
to put about one hundred and fiftythousand dollars down. I'm like, oh
gosh, no, you don't.No, no, no, no,
no no. I said, youcan invest the difference and make more money
on that than you can at threepercent. So if you have an investment
out there, any mutual fund,any stock right now is doing really well.
If you can think more than that, totally makes sense. We got
(10:52):
it. We gotta go to break, but we're gonna talk more about this
coming up. We're visiting with DebbieBloyd this hour, and the interest rates
stick around well. For the firsttime in a very long time, the
(11:13):
interest rates have started to go upand all indicators are they will continue to
rise as the US government is tryingto get a handle on inflation. One
of the levers, as we talkedabout the last segment that they can pull,
is raising interest rates to try toslow the demand and get the supply
chain and everything else back into order. My guests this hour is Debbie Bloyd.
(11:37):
She is a dollar diva now.Debbie, we were talking about the
last segment, really focusing on whatit means for your personal business, plus
talk about if you own a business. Would you advise somebody taking equity out
of their home to start a business? And I asked this question because we're
(12:00):
seeing the great resignation and more andmore people are wanting to be in business
for themselves. I think that's awesome. As someone who's an entrepreneur myself,
I encourage it, but it isa long road. Do you encourage taking
money out of your home to starta business? I guess that really depends
(12:20):
on how much you believe in yourself, so you don't want to put yourself
in any jeopardy. In Texas,you've got to leave twenty percent equity in
your house, so you can't takeall the equity out, so that kind
of saves you there. But yes, it's so much easier to borrow money
on your house and qualify that way. But once you become self employed,
(12:41):
let me explain that you cannot requalifyfor that house until you've been self employed
for two years, so you cantake the money out and start the business.
Just know, you can't do anythingabout your income to refinance or anything
for the next two years until youprove yourself in that business. So that's
a one shot that you're going tohave to sit in that money and whatever
(13:03):
you create for a few years.Is that smart money? Because going down
to a bank and trying to geta loan for a new business just does
not happen. And if you've evertried it, I'll just warn you right
now, they're going to give youmoney four times your cash flow. If
you're starting out, there is nocash flow. So is that smart money
to use to use your home equitycredit to do that? I would,
(13:24):
because Scott, I think we needto think of our home equity just as
that. It's our equity. It'spart of our net worth. So whether
you're barring against your house or you'reborrowing you're going to sell a car to
do it, it's still your networth somehow. So it's just taking from
a pile of money that's easily accessible. All piles of money are not exactly
(13:46):
created equal. I mean, ifyou borrow against your four oh one K
to start a business, you mayhave penalties and you've got a higher interest
rate than your house. Your houseis actually the cheapest way to finance something
because the rates are so you know, I really want to when we talk
about this concept, it really istrying to think the way the wealthy think,
(14:11):
because the way the middle class thinksis I want to pay off my
house. I don't want to havea mortgage, right, And I understand
that security and for some of youyou have that security gland, you need
to have that paid off for andI understand that. And I'm not advocating.
By the way, I'm not afinancial expert, so you know,
(14:33):
disclaimer here, don't come to ScottMiller to be your financial advisor. Okay,
But what I am an expert inis in my role, Debbie,
I get to visit with a lotof entrepreneurs, a lot of very successful
business leaders, and when I watchhow they handle their money, they always
want their money working for them,not just sitting there doing nothing. And
(14:54):
that's really kind of that concept ofpulling money out of your house and getting
to work for you so that it'smultiplying so that you can not only repay
it back if you want to,but you also have extra money to start
another business. Is that right exactly? So you're leveraging your money. So
that's just what the banks do,that's what insurance companies do, that's what
(15:16):
you've got to do. So Ihave a lot of clients got that are
scared. They think if I losemy job, at least my house will
be paid off. Well, thenyou've got all that money in your house.
You can't get it out. Thisis the whole reason why we do
a lot of reverse mortgages is becausepeople as they age want that security.
They think that paying off their housefree and clear. They're in the driver's
(15:37):
seat, they are in control.Nothing can happen. And really the worst
case happens. You know, theyget sick. They need to get that
money out of their house because theyhad to have no more money to get
They're working on a month to monthbasis, just like those people that have
jobs. So if you have everythingtied up in your house, you've got
to qualify, got to get thatmoney out. And if you are only
(15:58):
one charity, sometimes you can't qualifywhat the bills you have to even get
that money out, So you haveto sell your house in order to get
access to that cash. I don'tlike my cash behind that gate, So
I tell people you can put twentypercent down, but don't put fifty percent
down. Don't put eighty percent downon a house. That's crazy. Put
(16:18):
that money to work for you nowthat makes sense. And honestly, man,
you know, the whole idea ofonce you own a house you're completely
financially secure is also a myth.I know, like in states like Texas,
you still have to pay your incometax, right, you still have
to pay tax on the home.Even when you retire. It may freeze,
(16:40):
but you still have to pay taxeson it. And then guess what
happens to every single house, Thesame thing that happens to everything you own.
It starts to fall apart and youhave to repair it and you have
to take care of it. Andto me, I think, when I
reach that place of retirement, Iwant to find someplace that someone else takes
care of it, right right,Well, a lot of people when they
live in their homes, they theydon't. So Scott, you and I
(17:02):
expect in business the unexpected. Youinterview enough people that you know stuff happens.
I talk to enough people that Iknow stuff happens. People say I'm
going to retire at sixty five,but then they have a heart attack at
sixty. Now they're five years off, and now they're like, oh my
gosh, this didn't work out theway I had planned. Nothing works out
(17:22):
the way you plan. You've gota plan for the unexpected. So tying
up all your equity in a homeis never a smart move because you don't
have access to it when you needit if you can't requalify. Requalifying is
the ticket. And there's also ebbsand flows in the market and Debbie right
now it is I mean, isn'tit a seller's market? Is it still
(17:45):
a seller's market or is it startingto flow? Oh? No, it
is. It is. So morepeople are moving to Texas because we don't
have a stag in income tax.A lot of companies are moving here.
So I'm telling everyone that owns ahouse, you know, do you want
to think about selling it and cashout and do something else? The problem
is people don't think like that unlessthey have somewhere to go, somewhere to
(18:07):
be. They don't think of reshufflingtheir money. They just want to play
it safe. And then when youhunker down, you limit your choices.
So why not if you think thisis just a bubble, which it's not.
But if you think it is,then scrape everything off the table that's
extra right, take your equity outwhile it's really equity pay off that stuff
(18:29):
and then it's real. It doesn'tmatter if the market drops in ten years
if you've already got all the equityout of it, so what you're still
paying on it. So we justhave to make smart money moves, not
fear driven or anxious moves. Thatseems to be what people do. And
I would advise and Debbie would adviseas well. If you are married or
(18:49):
have a partner, make sure you'reon board with that. Don't be taken
out equity in your home to starta business if they were all on board
with it. No, you knowa spender always marries a saver, so
you know you're always going to havethat push pull right, yeah, but
but definitely work it out. Don'tdo anything surprises, so I don't,
(19:12):
DeBie. I don't want to beresponsible for any any any split up.
So we just want to good thingtoo, is it it's your primary here
in Texas, scott You've got tohave both people sign off on it.
So if you have a second home, that's different. But if it's your
primary home, you're taking that equityout of Both people have to sign so
both people will find out eventually,all right, It's Debbie Bloyd again.
(19:33):
She's the Dollar Diva. We'll tellyou more about her show and where you
can tune in here in just amoment, and when we return, we're
gonna talk about the supply chain issuesthat affected not only the mortgage business,
but affected every business. We're gonnapull out the crystal ball and we're gonna
tell you what our predictions are fortwenty twenty two. Stick around, you're
watching and listening to create, build, and manage. I guess this hour
(20:15):
is Debbie Boyd. She's the ownerand broker of DLB Mortgage Services located in
Texas. She's also the host ofthe Dollar Diva Show, which you can
hear on biz Talk Radio. Ifyou'd like to catch a show, I
strongly encourage it, just go toBIS talk radio dot com click on shows.
There you'll find more information. Youcan also download the BIS talk Radio
(20:36):
app where you can catch your showlive seven am Eastern time, and then
we replay it again at ten amEastern time to catch you whenever you are
driving and listening to Debbie. Debbie, you got a lot of energy and
I love having you on the showand I appreciate and we've been talking about
interest rates and We've kind of covereda lot of a lot of ground today,
(20:56):
But I want to get into acouple of other hot top that have
affected the real estate business and affectedevery business. Now, of course,
is the pandemic here. We arestill dealing with it, the omicron variant.
But I want to get into thesupply chain issues. Have you seen
anything that indicates that's letting up asfar as the building industry is concerned.
(21:21):
No, no, no, no, no no. So we still have
lumber is ebbing and flowing. Soit's gone back up twenty percent. It
was cheaper for a little while.So if your builders or your home improvement
guys construction people ordered it just right, they got a little bit of a
price beat. They won. Butwhen it comes to windows, some companies
(21:42):
cannot get the frames for the windows. Other companies are trying to find the
glass. There's just not enough stuff. Then when you look at boxes,
electrical boxes, they're still short ona lot of the pumps and a lot
of the things that are needed forpool equipment they can get either. So
I work with a lot of buildersand a lot of people are building homes
(22:03):
right now that are my clients.Houses that we're supposed to close in July
are just now closing because they couldn'tget pieces and parts in. You can't
get your electrical designation and sign offuntil you have the right electrical boxes and
things hooked up, and there's beena shortage of those boxes. So it's
going to take us about nine monthsto unwind from all this. If the
(22:23):
virus stays away and everybody keeps working, if the government decides to be really
smart to get and shut everything down, then we're going to be waiting longer.
So make sure you've got what youneed before you start, because if
not, your closings aren't going tobe on time. You're not going to
be able to close and finish thosehouses with any type of schedule. Nobody
(22:44):
kind of really knows. Yeah,And you know, from what I understand
as it relates to I don't thinkthey're going to shut things down. I
think I think there's a hope not. I think, if anything, we've
learned that that was not the answer. But on the supply chain issues,
it's really kind of interesting. I'veheard some horror stories and maybe you can
kind of clear the air if thisis true or not. Of people that
(23:07):
have signed to build a house,and then the price of that home went
up because the supplies, the costof the goods or the cost of the
wood, and everything went up.Is that something you can prenegotiate the lock
in a rate or pretty much whenyou buy a house you understand that that
price may go up because of that. Well, so I have a client
(23:30):
that signed a contract over the weekendto build a house, about a three
hundred thousand dollar house, and welocked his rate in last night. So
we locked his rate in for sixmonths. Now, with that being said,
he is guaranteed a rate of threepoint six and it won't go up.
He paid a thousand dollars to holdthat rate. Now, if his
house is not complete until August,then that thousand dollars he paid is going
(23:55):
to be out because the lock isn'tlong enough for that. It's only six
months. So that's one problem.Another problem is last year what we got
caught in is a lot of homebuilders canceled the contracts with their clients and
rewrote the contract and said this housenow costs sixty thousand dollars more. So
I have two clients that got caughtin that tumbleweed. It started at I'm
(24:18):
going to buy a four hundred andfifty thousand dollars house here if we signed
a contract. They're into it,they're getting ready to break ground, and
they go, oh, wait asecond, it's going to cost us a
lot more now because of lumber.So we're gonna tear up this contract and
we're gonna give you back your earnestmoney now if you want to resign with
us, it's gonna be five hundredthousand dollars to build the same house.
(24:40):
And a lot of people resigned,and a lot of people said heck no,
and there was like twenty people inline behind them that would sign gladly.
So there was a lot of thatlast summer. I don't think it's
quite that bad yet, but therewas a lot of turnover in a lot
of neighborhoods because the builders just theywould have lost thirty thousand dollars had they
built the house with that cur acontract. So they gave the people their
(25:00):
earnest money back and started over,which isn't fair anywhere around. None of
it's fair. Yeah, no,that makes sense, and it's and it's
not that the builder. I thinkin most cases there's always exception they're not
trying to take advantage, but toyour point, they would have lost lost
money. It's interesting, you know, when you look at the size of
things, you can always tell somethingabout the economy. You know, when
(25:23):
you look at cars. When thingsare going well, we're buying large SUVs,
we're buying the massive trucks, andthen when things are going down,
we're buying the small you know,the smaller cars. The same is true
with homes. And we saw thistrend sort of being more eco friendly and
the tiny houses, and we're allright sizing, and then the pandemic happened.
(25:47):
We're working at home and oh,so are you seeing people like I
got to get out of this crackerbox house. I need something bigger because
my job's at home and my spouseis driving me crazy. We need our
own space. Are you see inthat trend the other way? Yeah,
And that's why we have a shortageof houses. So we have two things
going on. We have all thepeople that are single living in apartments and
(26:08):
condos and we're very happy before thepandemic, and they were happy with their
little home, and then you sawthe pandemic hid and they had to work
from home. Well, they decidedthey didn't like that little cracker box,
like you said, so now they'regonna do something. You saw a lot
of divorces and a lot of marriagesand during the pandemic because people either were
(26:29):
stuffed in a house with someone theydecided they didn't like, so now that
person has to go out and findanother house. On the other side,
you got people wanting to get marriednow after the pandemic. Life is short.
You never know what's going to happen. So now those people are wanting
to buy something bigger than the littletwo apartments that they have. So it
seems like everybody's reshuffling right now.A lot of people are getting married older,
in their thirties and having children older. When you're in your twenties,
(26:52):
the two of you can live inanything, but when you start having a
baby with all the stuff that goeswith them. I've got two kids.
It took up a suburban just tocarry them and their stuff. Then you
need bigger spaces. So we alsohave the part of the seniors not getting
out of their houses. They're agingin place, so they are occupying the
(27:12):
houses that we used to go intoneighborhoods, buy up at a cheaper price
and then refurnish the neighborhood and makeit all nice, cool in retro,
right, So those people aren't movingeither. So you have a lot of
people moving around and then some peoplenot getting out of their homes. So
that's kind of upset the ecosystem thatwe had in place. Things are different
(27:33):
now. I think we're just scratchingthe surface, honestly, And when I
look at the future of work andwhat is it going to look like,
I think we're going to see moreand more people working from their house.
And what I'm reading now, Debbie, that's really interesting. It's going to
take they're saying five to six yearsbefore this fully flushes out, but you're
(27:55):
going to see it influx of peopleleaving the big cities and heading their small
hometowns that they grew up and thatthey left because they needed that big paycheck.
But now they can get the bigpaycheck working from home. So I
don't think. I think we're justgetting started. The next five years will
be interesting how we land, wherewe reshuffle, how many people are going
to be leaving the big urban areasheading rule And we already see, of
(28:18):
course, the big move from Californiaout to Texas and Florida and in other
places. It's going to be afun industry for you over the next five
years. I think yes, becauseyou really just don't know what's making people
move, whether it's they want tobe next to family, they just won
a bigger house. I've had severalclients this year moved from California where they
(28:38):
cashed out on a million and ahalf dollars twelve hundred square foot home and
they came to the Frisco Planos,Lina McKinney whatever area and about an eight
hundred thousand dollar house on an acrewith five bedrooms. And they feel like
they've won the lottery and they poppetedall that extra money, and they're working
from home and they have better schools. So it was a win win,
(29:00):
win win. It all depends onwhere you come from. If you've always
lived in a neighborhood and you've alwaysnever ventured out and you don't see the
big change, I think it's allperspective of where you're coming from and where
you're going. All right, well, Debbie, we got a little less
than two minutes. Let's talk aboutyour radio show. What can listeners expect
when they tune into your show ona daily basis, it's just me talking.
(29:23):
It's me talking about all the thingsto do and not to do things
that my clients are going through everysingle day. So they're like, how
does it How long does it takeyou to prepare for a show or whatever.
I'm like, I don't, It'sjust real life. There is so
much going on out there in ourlives that we're just not prepared for.
I have enough content to just talkfor hours and hours and hours, so
(29:45):
I really try to bring home thisis a real true story, this is
what not to do or this iswhat to do, And hopefully that'll resonate
with my listeners and they'll say,oh yeah, I know somebody that needs
that are Oh yeah, I shouldprobably think about that. Because I'm in
the money business. I think aboutmoney all day long every day, and
I sleep dream about money. Butit's not everyone's full time job, so
(30:08):
it's an afterthought for a lot ofpeople, and that's where we get caught.
Always good to have an expert,and Debbie certainly can help you.
Debbie, if someone is watching orlistening and they want to get a hold
of you to ask you more specificquestions to their situations. How can they
best get ahold of you? Letme give you my cell phone number.
I know that's not always appropriate,but I do it all the time,
(30:30):
so everyone has my number. It'snine seven nine two two zero three zero
one eight. I'm on TikTok,Instagram, Facebook, and all those places
have my phone number published all overit. So please call me, leave
a message. I'll call you backand I'll be happy to help. That's
awesome. You are brave. That'sDebbie. Appreciate your time. Debbie.
Thank you for the insight and everythingthat's going on with interest rates and supply
(30:53):
chain and giving us some things tothink about. Stick around. We're gonna
wrap things up. You are watchingand listening to Create, Build and Manage
back after this, and welcome backto Create, Build and Manage. We've
(31:22):
been talking about interest rates and thereason why the government is raising the interest
rates and it really has to dowith supply and demand and Russell Sorrow our
producers here with us. Russell,I'm curious, did you collect anything when
you were When you were a kid, I collected rocks. You collected rocks.
(31:45):
I was a junior geologist. Thatthat was what I do. That
is awesome. That is awesome.Well, I collected baseball cards. And
I bring this up because it's areal simple analogy to understand the difference between
inflation and price and demands. So, Russell, when I was a kid,
and I'm just a little bit olderthan you, we won't say how
(32:07):
much older, but we collected mydad and I collected unusual baseball cards.
Now, my dad was in thegrocery business, so we would collect baseball
cards like from Wonder Bread, fromPost Serial and Mother's Cookies. I don't
know if you remember Mother's Cookies ornot, but it used to be a
cookie brand that was real popular.And so what was unique about the Mother's
(32:30):
Cookies cards is they did not havean agreement. I don't think they can
get away with us today. Theydidn't have an agreement with the Major League
Baseball to license the logos, sothe baseball players would have on the team
colors with no logos. So youhad like Nolan Ryan wearing a blue cap
without the iconic old Texas Ranger tea. And we had four cards of Nolan
(32:52):
Ryan. I remember going down thelocal baseball card shop and those four cards
we're talking about the nineteen nineties wasvalued at two hundred dollars. Two hundred
dollars. My dad and I wereexcited. We sold a couple of them,
and of course, like any goodcollector, we took that money.
We vested it back into more baseballcards. So my dad's advice to me
(33:13):
was, son, hold on inthese cards. It'll pay for your kids
college. I have boxes and boxesof baseball cards today that are practically worthless.
The Internet came on the scene,and you go find that same baseball
card. And now with the Internetthere is more supply that people can get
a hold of, and that samebaseball card that was two hundred bucks per
(33:34):
set of four, one individual cardninety nine cents. Now there are still
some baseball cards that are valuable throughthe pandemic. They're the ones that are
the unopened baseball cards. The mysteryof what card you may get. People
are paying money for that. Butthe reality is is when the Internet came
on the scene, it all butkilled the baseball collection business as far as
a value of it. And that'ssupply and demand its best. When it
(33:59):
was just the local baseball card shopman I had, I had the supplies
and there was a huge demand.I was able to sell it for two
hundred dollars, but when the Internetcame on the scene and those cards are
everywhere, it went down to ninetynine cents. So by raising the interest
rates it creates, it sort ofslows down the demand, and it's an
(34:20):
effort to get the economy back intosome normalcy. It'll be interesting to see
what happens through twenty twenty two.So there's my little lesson for you.
I don't know if that applies toRocks. I don't know that you've sold
Rocks, but you certainly collected him. Have you been on Facebook? Are
you a Facebook guy? Not anymore? I just try to stay off the
(34:43):
social media in general. Now youwere smart. You were smart. Now
they're doing the ten year challenge,and I wanted to show you some pictures
here. I was kind of havingfun. So this picture right here,
this is of me and my wifeten years ago. It's my lovely bride.
Station actually attending a work conference NAPTINational Association of Television Producers and Executives.
(35:07):
Just a little name drop in there. We actually spent some time and
hung out with the cast of Parksand rec at this party. The Versace
home there in Miami's where we're at. And this is us now ten years
later. On our recent trip,we had to New York and as you
could see, yeah, we've Ithink we still look good. There we
(35:29):
are in front of the tree.We were in New York with the family,
just before things started to shut downagain and join time. Speaking of
the family, this is my lovelyfamily here. They're going to kill me
for showing this picture. This isten years ago us attending a Texas Ranger
game. We shoot the show inArlington, Texas. We actually can see
the Rangers ballpark from our studios andthis is what they look like the family
(35:52):
today. This was actually taken justlast weekend and a very emotional weekend for
us. As my oldest daughter.There's my two daughters hugging each other.
My oldest daughter on the left isnow a freshman in college. A freshman
(36:13):
in college, hard to believe.And there's you know, someone asked me
recently, how are you handling that, having one of your two daughters out
of the house. I'm like,man, there are no words, you
really there are. There's nothing youcan do to prepare yourself for that moment,
there's no words that can actually describeit. And so it's certainly a
(36:35):
process that we're dealing with. Andif any of you've ever been an empty
nester, you know exactly what we'retalking about. But we still have our
younger daughter that's going in high schoolnext year. No doubt the next four
years will fly by as well.We're so glad you tune in to create,
build, and manage big announcement.We kind of tease this announcement a
(36:57):
little bit last year, but nowwe can give you the official announcement.
My new my first book. Isay my new book like I've written more
than one, but my first book. There you see it, Media Matters,
How to Leverage the Media to Growyour Business. It's coming out on
March fifteenth. Mark your calendars forMarch fifteenth to get your copy of Media
(37:22):
Matters How to Leverage the Media toGrow your Business. I wrote this book
with the small, medium sized businessowner in mind. There's so much that's
changing in the world of media.Arguably today we are the viewership is much
more divided, and we're not talkingabout political lines, just how you consume
content. You may watch content likeyou're watching this show on biz TV over
(37:46):
digital broadcast. You may listen toit like you may be listening to the
show on a radio station or apodcast. You may be watching the streaming
version of this show on bisvo dotcom on any of the devices, whether
it's Apple or Roku or you knowGoogle or you know Amazon. So many
(38:07):
different ways you can consume content.Now, so how do you, as
a business owner market your business inthis new world that's only going to get
more divided. Well, that's whatwe talk about in media Matters again.
It's due out on March fifteenth.As we get closer, we'll give you
an opportunity how you can pre orderthat book. So we're so excited.
(38:29):
It's team effort. The entire teamhere at Center Post Media, a parent
company to BIS TV and BIS TalkRadio, put our efforts into that.
So I'm excited about that, Russell. I'm excited to have another year.
We got a lot of exciting guestscoming up over the next few weeks.
Season what is a season number threeof Create Build Manners? Here we are.
(38:55):
He's excited. I am very excited. Sorry to be thrown back to
me again, but now it backto you. It's all good. Hey,
thanks so much for watching us.If you want to watch more content
or catch previous episodes, make sureyou go to bisbod dot com, b
i z vod dot com. Also, if you haven't done so already,
you can't subscribe to our podcast onany platform you get your podcast, just
(39:17):
look for Create, build and Manage. For Russell Sorrow, for Julia Grub
and everybody. I'm Scott Miller.Until next time,
Welcome to Create, Build, Managethe Entrepreneurs Toolbox. Here's your host,
Scott Miller, and welcome to anotherepisode to Create, Build and Manage.
I'm Scott Miller. I hope you'rehaving a great January thus far. Today
we're going to talk about things thatare going on in business, of course,
(00:30):
and specifically what's going on with inflationand how that could mean higher interest
rates. I want to welcome toour show our resonent real estate expert.
She is the dollar Diva herself,Debbie Bloy. Debbie, welcome to the
show. Hi, thanks so muchfor having me. Oh, it's always
a pleasure. Debbie is when Isay you're a resident real estate expert.
(00:54):
She has a show on her sisternetwork, Busin Talk Radio that airs weekdays
at seven am and ten am EasternTime. You can find that show in
BizTalk Radio dot com or listen toher on the BizTalk Radio app. But
as you can see from your logobehind you, you're not just a pretty
face for radio. You also haveyour own business. You are the owner
(01:15):
and broker of DLB Mortgage Services.Now, when I talk about interest rates,
Debbie, this is something that Iknow is talked about a lot in
the world of real estate. Isthe interest rate going to go higher?
We always talk about that, butnow it's a real possibility. As a
US government looks for ways to getthe inflation under control, one of those
(01:38):
leverages they can pull is raising theinterest rate. And what I'm reading in
the trades is that something that's goingto happen, perhaps as early as March,
maybe even late February. What areyou hearing It already happened. It
happened for the first time. Soit happened between last week and this week.
We're up three quarters of a point, which doesn't sound like a lot,
(01:59):
but on a four hundred thousand dollarsloan, that could be two to
three hundred dollars a month. Soit is a real thing. It's happening,
and I don't think it's going tostop. It's only going to go
up from here. So this isjust the beginning. So it really gets
into when we talk about why theywould raise interest rates. Let's kind of
unpack that because I think it's importantfor people that may not understand when I
(02:23):
talk about it's one of the leveragesthat the government can pull. So we
have this inflation, which is allabout demand. There's a huge demand out
there, and we economics one onone, particularly in a capitalist you know
economy, like we have, themore demand you have to hire, the
price gets. So why raising interestrates? That kind of slows down the
(02:45):
demand, right, not just forhousing, but for a lot of things,
you know, it does, Scott, and that's what they're hoping to
do right now. We can't catchup. We cannot catch up to build
enough houses. We can't get enoughlumber, we can't get enough windows or
flies, and so this is goingto slow it down. But actually,
you know, it takes the lookersout of the business. And it's only
(03:07):
really the serious people. But thereare people that have to move, whether
it's for their job or for familyreasons. So people aren't just willy nilly
picking up everything and spending a lotof money moving. They're doing it for
purposes. And this is going tonot only slow that down, but it's
going to cost the consumer more.It is going to cost a lot more.
(03:28):
And what's interesting about that is onthe surface, again, if you're
not a student of the economy,you may think this is a bad thing,
and there certainly are some negative things, right Debbie I mean, if
you are trying to refile your house, if you're trying to close on a
home, higher interest rates equals thousandsof more dollars you're going to spend over
the lifetime of your loan. Right, But there is some positive to it
(03:51):
as well, is there not.Yeah, So if you own a home,
you have got the benefit of inflation. These last I don't know,
six months, eight months a year, so your house has probably gone up
in value here in the Dallas FortWorth area at least twenty percent. So
for a lot of people, theylove this because now their house is worth
(04:13):
more. If they do a cashout refinance to pay off some bills,
they're going to take that equity outof their house. They're going to have
the equity they didn't know they hadbecause now their house is worth twenty percent
more. That frees up a lotof money. Now, some people say
this is pretend money. It's realmoney when you take it out of the
equity of your house. If youleave it sitting in in your house,
it just looks pretty on paper,but it is real money, and real
(04:38):
people are coming in with real cashand we're buying up real estate here in
the Texas area. Well, it'sit's in Texas, and it's true in
other parts as well as across theUS. So let's talk about that because
there's you know, when is thetime to do a cash out refly.
(04:58):
So if you are an into visualand you have a home, and I'll
tell you my situation. We boughtour home five years ago. I'm also
in the Dallas Fort Worth area,and we've watched the value of our home
increase. I mean, it's justit's almost shocking what the what the value
of the home is now now believeme, come tax time it's also shocking,
(05:18):
which is a whole other story inTexas when you're paying side right.
Yeah, yeah, But what wouldyou recommend I mean, or what are
some good reasons why someone would wantto do a cash out REFI and in
essence add more debt to their home. Well, it depends on what your
(05:39):
financial picture looks like. So whatwe do, because I do more than
just real estate and finances, Ikind of look at the holistic approach of
who you are and what you have. A lot of times people are using
their house as a cash register toredistribute their wealth. So you're making a
job and you have a job.Maybe your job makes more, maybe your
(06:00):
debt your self employed. But youhave kids. If you have kids,
you've got bills. So whether you'repaying for college, buying cars, you
and your family get a car.Now you've got some more debt, Well,
that interest rate, you're gonna wantto redistribute your money to where you're
not wasting it on interest that youdon't need to. So if you have
(06:21):
high interest rates credit cards, ifyou've got student loan debt for you or
your kids, If you owe acar nodes and you can borrow against your
house at three and a half percentand your car notes at six percent,
take the money out of your house, pay off your car. If you
can pay off student loans, doit. If you can pay off eighteen
percent interest rates on your credit cards, do it because now you're saving money.
(06:45):
You're spending the same amount, butyou've mooshed it around a little bit
to where it's more advantageous to you. We still get to write off interest
on our mortgage. We don't getto write off interest on our credit cards.
Now that could all change, butright now, this tax here,
we still get to write off thatmortgage interest. So you're redistributing your wealth
to better benefit you in your situation. It changes all the time. That
(07:12):
is absolutely brilliant, And I justwant to take a moment to really kind
of unpack that because, and Idon't know why this is, but the
interest rate on homes always seems tobe lower than the interest rate on the
car, certainly lower than the interestrate and that revolving credit line you have
on your credit card. Why isthe interest rate always better on homes,
(07:33):
which is arguably a larger purchase.Probably the most expensive thing you'll buy is
your home, versus the interest rateon these other purchases. Well, you
know, the bank owns your car, and they can come and get it
if you owe on it, andthat's call a repossession. They can foreclose
on your house, but just thinkabout it. Your house. They give
(07:55):
you a lot longer to pay itoff, thirty years, and sometimes there
are loans that go up to fortyyears. There are interest only loans.
They're doing everything they can to makeyou have home ownership. So some people
need a thirty year mortgage for aforty year mortgage. Some want to pay
it all fast. It's all inmanaging debt. But you or I could
not afford to go out and paycash or leverage a four or five hundred
(08:16):
or eight hundred thousand dollar house infive years. So this puts it in
bite sized pieces. And this ishow the mortgage business started a long time
ago, bite sized pieces so thatwe could afford it, and the banks
could leverage the money that they haveto make money. So it's kind of
a win win for everyone. Now, that absolutely makes sense. And so
(08:39):
when you look at your interest rates, you know, again I just look
at my personal experience. Right,we have a used car, we bought
a guarantee. You interest rate isprobably twice what it is on our home.
We still have those lingering student loansbecause my wife and I met at
a private Christian school. Hello,we still have Yeah, we still have
(09:00):
them, and we've we've got aline of credit that we're paying off some
other things. So you know,in our case, and again I'm just
using our example, it would bewise to take that extra equity we have
in our home roll that dead inthere. And the one benefit you said
that I've never thought about, Like, I get the idea of the lower
interest rate, but it's the taxbenefits that never really clicked in my mind
(09:22):
where every year we get a lotback on income tax because of child credit
and because of the equity or theinterest we're paying on our on our mortgage.
Right, Well, what happens,Scott is a lot of people don't
put all of their people in aroom. So like my people, my
people are attorneys, CPA's financial advisor'smortgage people. You may not have a
(09:46):
CPA, Well then you if youdo turbo tax or something on your own,
you're not going to know how tomaneuver money. So it takes all
of us together as like little villageto get you through the finish line.
And everyone has a different opinions,so it really does take you talking to
your CPA, talking to your financialperson, talking to your mortgage person to
(10:07):
figuring out how to get you inthe best position. I had a girl
yesterday call me. She is incollege, she has money saved up,
and she was I think I thinkshe got an insurance claim of some kind.
So she has about one hundred andfifty thousand dollars and she's twenty four
years old. She wants to buya house to live in instead of rent.
(10:28):
So she's like, you know,miss Debbie, I would really want
to put about one hundred and fiftythousand dollars down. I'm like, oh
gosh, no, you don't.No, no, no, no,
no no. I said, youcan invest the difference and make more money
on that than you can at threepercent. So if you have an investment
out there, any mutual fund,any stock right now is doing really well.
If you can think more than that, totally makes sense. We got
(10:52):
it. We gotta go to break, but we're gonna talk more about this
coming up. We're visiting with DebbieBloyd this hour, and the interest rates
stick around well. For the firsttime in a very long time, the
(11:13):
interest rates have started to go upand all indicators are they will continue to
rise as the US government is tryingto get a handle on inflation. One
of the levers, as we talkedabout the last segment that they can pull,
is raising interest rates to try toslow the demand and get the supply
chain and everything else back into order. My guests this hour is Debbie Bloyd.
(11:37):
She is a dollar diva now.Debbie, we were talking about the
last segment, really focusing on whatit means for your personal business, plus
talk about if you own a business. Would you advise somebody taking equity out
of their home to start a business? And I asked this question because we're
(12:00):
seeing the great resignation and more andmore people are wanting to be in business
for themselves. I think that's awesome. As someone who's an entrepreneur myself,
I encourage it, but it isa long road. Do you encourage taking
money out of your home to starta business? I guess that really depends
(12:20):
on how much you believe in yourself, so you don't want to put yourself
in any jeopardy. In Texas,you've got to leave twenty percent equity in
your house, so you can't takeall the equity out, so that kind
of saves you there. But yes, it's so much easier to borrow money
on your house and qualify that way. But once you become self employed,
(12:41):
let me explain that you cannot requalifyfor that house until you've been self employed
for two years, so you cantake the money out and start the business.
Just know, you can't do anythingabout your income to refinance or anything
for the next two years until youprove yourself in that business. So that's
a one shot that you're going tohave to sit in that money and whatever
(13:03):
you create for a few years.Is that smart money? Because going down
to a bank and trying to geta loan for a new business just does
not happen. And if you've evertried it, I'll just warn you right
now, they're going to give youmoney four times your cash flow. If
you're starting out, there is nocash flow. So is that smart money
to use to use your home equitycredit to do that? I would,
(13:24):
because Scott, I think we needto think of our home equity just as
that. It's our equity. It'spart of our net worth. So whether
you're barring against your house or you'reborrowing you're going to sell a car to
do it, it's still your networth somehow. So it's just taking from
a pile of money that's easily accessible. All piles of money are not exactly
(13:46):
created equal. I mean, ifyou borrow against your four oh one K
to start a business, you mayhave penalties and you've got a higher interest
rate than your house. Your houseis actually the cheapest way to finance something
because the rates are so you know, I really want to when we talk
about this concept, it really istrying to think the way the wealthy think,
(14:11):
because the way the middle class thinksis I want to pay off my
house. I don't want to havea mortgage, right, And I understand
that security and for some of youyou have that security gland, you need
to have that paid off for andI understand that. And I'm not advocating.
By the way, I'm not afinancial expert, so you know,
(14:33):
disclaimer here, don't come to ScottMiller to be your financial advisor. Okay,
But what I am an expert inis in my role, Debbie,
I get to visit with a lotof entrepreneurs, a lot of very successful
business leaders, and when I watchhow they handle their money, they always
want their money working for them,not just sitting there doing nothing. And
(14:54):
that's really kind of that concept ofpulling money out of your house and getting
to work for you so that it'smultiplying so that you can not only repay
it back if you want to,but you also have extra money to start
another business. Is that right exactly? So you're leveraging your money. So
that's just what the banks do,that's what insurance companies do, that's what
(15:16):
you've got to do. So Ihave a lot of clients got that are
scared. They think if I losemy job, at least my house will
be paid off. Well, thenyou've got all that money in your house.
You can't get it out. Thisis the whole reason why we do
a lot of reverse mortgages is becausepeople as they age want that security.
They think that paying off their housefree and clear. They're in the driver's
(15:37):
seat, they are in control.Nothing can happen. And really the worst
case happens. You know, theyget sick. They need to get that
money out of their house because theyhad to have no more money to get
They're working on a month to monthbasis, just like those people that have
jobs. So if you have everythingtied up in your house, you've got
to qualify, got to get thatmoney out. And if you are only
(15:58):
one charity, sometimes you can't qualifywhat the bills you have to even get
that money out, So you haveto sell your house in order to get
access to that cash. I don'tlike my cash behind that gate, So
I tell people you can put twentypercent down, but don't put fifty percent
down. Don't put eighty percent downon a house. That's crazy. Put
(16:18):
that money to work for you nowthat makes sense. And honestly, man,
you know, the whole idea ofonce you own a house you're completely
financially secure is also a myth.I know, like in states like Texas,
you still have to pay your incometax, right, you still have
to pay tax on the home.Even when you retire. It may freeze,
(16:40):
but you still have to pay taxeson it. And then guess what
happens to every single house, Thesame thing that happens to everything you own.
It starts to fall apart and youhave to repair it and you have
to take care of it. Andto me, I think, when I
reach that place of retirement, Iwant to find someplace that someone else takes
care of it, right right,Well, a lot of people when they
live in their homes, they theydon't. So Scott, you and I
(17:02):
expect in business the unexpected. Youinterview enough people that you know stuff happens.
I talk to enough people that Iknow stuff happens. People say I'm
going to retire at sixty five,but then they have a heart attack at
sixty. Now they're five years off, and now they're like, oh my
gosh, this didn't work out theway I had planned. Nothing works out
(17:22):
the way you plan. You've gota plan for the unexpected. So tying
up all your equity in a homeis never a smart move because you don't
have access to it when you needit if you can't requalify. Requalifying is
the ticket. And there's also ebbsand flows in the market and Debbie right
now it is I mean, isn'tit a seller's market? Is it still
(17:45):
a seller's market or is it startingto flow? Oh? No, it
is. It is. So morepeople are moving to Texas because we don't
have a stag in income tax.A lot of companies are moving here.
So I'm telling everyone that owns ahouse, you know, do you want
to think about selling it and cashout and do something else? The problem
is people don't think like that unlessthey have somewhere to go, somewhere to
(18:07):
be. They don't think of reshufflingtheir money. They just want to play
it safe. And then when youhunker down, you limit your choices.
So why not if you think thisis just a bubble, which it's not.
But if you think it is,then scrape everything off the table that's
extra right, take your equity outwhile it's really equity pay off that stuff
(18:29):
and then it's real. It doesn'tmatter if the market drops in ten years
if you've already got all the equityout of it, so what you're still
paying on it. So we justhave to make smart money moves, not
fear driven or anxious moves. Thatseems to be what people do. And
I would advise and Debbie would adviseas well. If you are married or
(18:49):
have a partner, make sure you'reon board with that. Don't be taken
out equity in your home to starta business if they were all on board
with it. No, you knowa spender always marries a saver, so
you know you're always going to havethat push pull right, yeah, but
but definitely work it out. Don'tdo anything surprises, so I don't,
(19:12):
DeBie. I don't want to beresponsible for any any any split up.
So we just want to good thingtoo, is it it's your primary here
in Texas, scott You've got tohave both people sign off on it.
So if you have a second home, that's different. But if it's your
primary home, you're taking that equityout of Both people have to sign so
both people will find out eventually,all right, It's Debbie Bloyd again.
(19:33):
She's the Dollar Diva. We'll tellyou more about her show and where you
can tune in here in just amoment, and when we return, we're
gonna talk about the supply chain issuesthat affected not only the mortgage business,
but affected every business. We're gonnapull out the crystal ball and we're gonna
tell you what our predictions are fortwenty twenty two. Stick around, you're
watching and listening to create, build, and manage. I guess this hour
(20:15):
is Debbie Boyd. She's the ownerand broker of DLB Mortgage Services located in
Texas. She's also the host ofthe Dollar Diva Show, which you can
hear on biz Talk Radio. Ifyou'd like to catch a show, I
strongly encourage it, just go toBIS talk radio dot com click on shows.
There you'll find more information. Youcan also download the BIS talk Radio
(20:36):
app where you can catch your showlive seven am Eastern time, and then
we replay it again at ten amEastern time to catch you whenever you are
driving and listening to Debbie. Debbie, you got a lot of energy and
I love having you on the showand I appreciate and we've been talking about
interest rates and We've kind of covereda lot of a lot of ground today,
(20:56):
But I want to get into acouple of other hot top that have
affected the real estate business and affectedevery business. Now, of course,
is the pandemic here. We arestill dealing with it, the omicron variant.
But I want to get into thesupply chain issues. Have you seen
anything that indicates that's letting up asfar as the building industry is concerned.
(21:21):
No, no, no, no, no no. So we still have
lumber is ebbing and flowing. Soit's gone back up twenty percent. It
was cheaper for a little while.So if your builders or your home improvement
guys construction people ordered it just right, they got a little bit of a
price beat. They won. Butwhen it comes to windows, some companies
(21:42):
cannot get the frames for the windows. Other companies are trying to find the
glass. There's just not enough stuff. Then when you look at boxes,
electrical boxes, they're still short ona lot of the pumps and a lot
of the things that are needed forpool equipment they can get either. So
I work with a lot of buildersand a lot of people are building homes
(22:03):
right now that are my clients.Houses that we're supposed to close in July
are just now closing because they couldn'tget pieces and parts in. You can't
get your electrical designation and sign offuntil you have the right electrical boxes and
things hooked up, and there's beena shortage of those boxes. So it's
going to take us about nine monthsto unwind from all this. If the
(22:23):
virus stays away and everybody keeps working, if the government decides to be really
smart to get and shut everything down, then we're going to be waiting longer.
So make sure you've got what youneed before you start, because if
not, your closings aren't going tobe on time. You're not going to
be able to close and finish thosehouses with any type of schedule. Nobody
(22:44):
kind of really knows. Yeah,And you know, from what I understand
as it relates to I don't thinkthey're going to shut things down. I
think I think there's a hope not. I think, if anything, we've
learned that that was not the answer. But on the supply chain issues,
it's really kind of interesting. I'veheard some horror stories and maybe you can
kind of clear the air if thisis true or not. Of people that
(23:07):
have signed to build a house,and then the price of that home went
up because the supplies, the costof the goods or the cost of the
wood, and everything went up.Is that something you can prenegotiate the lock
in a rate or pretty much whenyou buy a house you understand that that
price may go up because of that. Well, so I have a client
(23:30):
that signed a contract over the weekendto build a house, about a three
hundred thousand dollar house, and welocked his rate in last night. So
we locked his rate in for sixmonths. Now, with that being said,
he is guaranteed a rate of threepoint six and it won't go up.
He paid a thousand dollars to holdthat rate. Now, if his
house is not complete until August,then that thousand dollars he paid is going
(23:55):
to be out because the lock isn'tlong enough for that. It's only six
months. So that's one problem.Another problem is last year what we got
caught in is a lot of homebuilders canceled the contracts with their clients and
rewrote the contract and said this housenow costs sixty thousand dollars more. So
I have two clients that got caughtin that tumbleweed. It started at I'm
(24:18):
going to buy a four hundred andfifty thousand dollars house here if we signed
a contract. They're into it,they're getting ready to break ground, and
they go, oh, wait asecond, it's going to cost us a
lot more now because of lumber.So we're gonna tear up this contract and
we're gonna give you back your earnestmoney now if you want to resign with
us, it's gonna be five hundredthousand dollars to build the same house.
(24:40):
And a lot of people resigned,and a lot of people said heck no,
and there was like twenty people inline behind them that would sign gladly.
So there was a lot of thatlast summer. I don't think it's
quite that bad yet, but therewas a lot of turnover in a lot
of neighborhoods because the builders just theywould have lost thirty thousand dollars had they
built the house with that cur acontract. So they gave the people their
(25:00):
earnest money back and started over,which isn't fair anywhere around. None of
it's fair. Yeah, no,that makes sense, and it's and it's
not that the builder. I thinkin most cases there's always exception they're not
trying to take advantage, but toyour point, they would have lost lost
money. It's interesting, you know, when you look at the size of
things, you can always tell somethingabout the economy. You know, when
(25:23):
you look at cars. When thingsare going well, we're buying large SUVs,
we're buying the massive trucks, andthen when things are going down,
we're buying the small you know,the smaller cars. The same is true
with homes. And we saw thistrend sort of being more eco friendly and
the tiny houses, and we're allright sizing, and then the pandemic happened.
(25:47):
We're working at home and oh,so are you seeing people like I
got to get out of this crackerbox house. I need something bigger because
my job's at home and my spouseis driving me crazy. We need our
own space. Are you see inthat trend the other way? Yeah,
And that's why we have a shortageof houses. So we have two things
going on. We have all thepeople that are single living in apartments and
(26:08):
condos and we're very happy before thepandemic, and they were happy with their
little home, and then you sawthe pandemic hid and they had to work
from home. Well, they decidedthey didn't like that little cracker box,
like you said, so now they'regonna do something. You saw a lot
of divorces and a lot of marriagesand during the pandemic because people either were
(26:29):
stuffed in a house with someone theydecided they didn't like, so now that
person has to go out and findanother house. On the other side,
you got people wanting to get marriednow after the pandemic. Life is short.
You never know what's going to happen. So now those people are wanting
to buy something bigger than the littletwo apartments that they have. So it
seems like everybody's reshuffling right now.A lot of people are getting married older,
in their thirties and having children older. When you're in your twenties,
(26:52):
the two of you can live inanything, but when you start having a
baby with all the stuff that goeswith them. I've got two kids.
It took up a suburban just tocarry them and their stuff. Then you
need bigger spaces. So we alsohave the part of the seniors not getting
out of their houses. They're agingin place, so they are occupying the
(27:12):
houses that we used to go intoneighborhoods, buy up at a cheaper price
and then refurnish the neighborhood and makeit all nice, cool in retro,
right, So those people aren't movingeither. So you have a lot of
people moving around and then some peoplenot getting out of their homes. So
that's kind of upset the ecosystem thatwe had in place. Things are different
(27:33):
now. I think we're just scratchingthe surface, honestly, And when I
look at the future of work andwhat is it going to look like,
I think we're going to see moreand more people working from their house.
And what I'm reading now, Debbie, that's really interesting. It's going to
take they're saying five to six yearsbefore this fully flushes out, but you're
(27:55):
going to see it influx of peopleleaving the big cities and heading their small
hometowns that they grew up and thatthey left because they needed that big paycheck.
But now they can get the bigpaycheck working from home. So I
don't think. I think we're justgetting started. The next five years will
be interesting how we land, wherewe reshuffle, how many people are going
to be leaving the big urban areasheading rule And we already see, of
(28:18):
course, the big move from Californiaout to Texas and Florida and in other
places. It's going to be afun industry for you over the next five
years. I think yes, becauseyou really just don't know what's making people
move, whether it's they want tobe next to family, they just won
a bigger house. I've had severalclients this year moved from California where they
(28:38):
cashed out on a million and ahalf dollars twelve hundred square foot home and
they came to the Frisco Planos,Lina McKinney whatever area and about an eight
hundred thousand dollar house on an acrewith five bedrooms. And they feel like
they've won the lottery and they poppetedall that extra money, and they're working
from home and they have better schools. So it was a win win,
(29:00):
win win. It all depends onwhere you come from. If you've always
lived in a neighborhood and you've alwaysnever ventured out and you don't see the
big change, I think it's allperspective of where you're coming from and where
you're going. All right, well, Debbie, we got a little less
than two minutes. Let's talk aboutyour radio show. What can listeners expect
when they tune into your show ona daily basis, it's just me talking.
(29:23):
It's me talking about all the thingsto do and not to do things
that my clients are going through everysingle day. So they're like, how
does it How long does it takeyou to prepare for a show or whatever.
I'm like, I don't, It'sjust real life. There is so
much going on out there in ourlives that we're just not prepared for.
I have enough content to just talkfor hours and hours and hours, so
(29:45):
I really try to bring home thisis a real true story, this is
what not to do or this iswhat to do, And hopefully that'll resonate
with my listeners and they'll say,oh yeah, I know somebody that needs
that are Oh yeah, I shouldprobably think about that. Because I'm in
the money business. I think aboutmoney all day long every day, and
I sleep dream about money. Butit's not everyone's full time job, so
(30:08):
it's an afterthought for a lot ofpeople, and that's where we get caught.
Always good to have an expert,and Debbie certainly can help you.
Debbie, if someone is watching orlistening and they want to get a hold
of you to ask you more specificquestions to their situations. How can they
best get ahold of you? Letme give you my cell phone number.
I know that's not always appropriate,but I do it all the time,
(30:30):
so everyone has my number. It'snine seven nine two two zero three zero
one eight. I'm on TikTok,Instagram, Facebook, and all those places
have my phone number published all overit. So please call me, leave
a message. I'll call you backand I'll be happy to help. That's
awesome. You are brave. That'sDebbie. Appreciate your time. Debbie.
Thank you for the insight and everythingthat's going on with interest rates and supply
(30:53):
chain and giving us some things tothink about. Stick around. We're gonna
wrap things up. You are watchingand listening to Create, Build and Manage
back after this, and welcome backto Create, Build and Manage. We've
(31:22):
been talking about interest rates and thereason why the government is raising the interest
rates and it really has to dowith supply and demand and Russell Sorrow our
producers here with us. Russell,I'm curious, did you collect anything when
you were When you were a kid, I collected rocks. You collected rocks.
(31:45):
I was a junior geologist. Thatthat was what I do. That
is awesome. That is awesome.Well, I collected baseball cards. And
I bring this up because it's areal simple analogy to understand the difference between
inflation and price and demands. So, Russell, when I was a kid,
and I'm just a little bit olderthan you, we won't say how
(32:07):
much older, but we collected mydad and I collected unusual baseball cards.
Now, my dad was in thegrocery business, so we would collect baseball
cards like from Wonder Bread, fromPost Serial and Mother's Cookies. I don't
know if you remember Mother's Cookies ornot, but it used to be a
cookie brand that was real popular.And so what was unique about the Mother's
(32:30):
Cookies cards is they did not havean agreement. I don't think they can
get away with us today. Theydidn't have an agreement with the Major League
Baseball to license the logos, sothe baseball players would have on the team
colors with no logos. So youhad like Nolan Ryan wearing a blue cap
without the iconic old Texas Ranger tea. And we had four cards of Nolan
(32:52):
Ryan. I remember going down thelocal baseball card shop and those four cards
we're talking about the nineteen nineties wasvalued at two hundred dollars. Two hundred
dollars. My dad and I wereexcited. We sold a couple of them,
and of course, like any goodcollector, we took that money.
We vested it back into more baseballcards. So my dad's advice to me
(33:13):
was, son, hold on inthese cards. It'll pay for your kids
college. I have boxes and boxesof baseball cards today that are practically worthless.
The Internet came on the scene,and you go find that same baseball
card. And now with the Internetthere is more supply that people can get
a hold of, and that samebaseball card that was two hundred bucks per
(33:34):
set of four, one individual cardninety nine cents. Now there are still
some baseball cards that are valuable throughthe pandemic. They're the ones that are
the unopened baseball cards. The mysteryof what card you may get. People
are paying money for that. Butthe reality is is when the Internet came
on the scene, it all butkilled the baseball collection business as far as
a value of it. And that'ssupply and demand its best. When it
(33:59):
was just the local baseball card shopman I had, I had the supplies
and there was a huge demand.I was able to sell it for two
hundred dollars, but when the Internetcame on the scene and those cards are
everywhere, it went down to ninetynine cents. So by raising the interest
rates it creates, it sort ofslows down the demand, and it's an
(34:20):
effort to get the economy back intosome normalcy. It'll be interesting to see
what happens through twenty twenty two.So there's my little lesson for you.
I don't know if that applies toRocks. I don't know that you've sold
Rocks, but you certainly collected him. Have you been on Facebook? Are
you a Facebook guy? Not anymore? I just try to stay off the
(34:43):
social media in general. Now youwere smart. You were smart. Now
they're doing the ten year challenge,and I wanted to show you some pictures
here. I was kind of havingfun. So this picture right here,
this is of me and my wifeten years ago. It's my lovely bride.
Station actually attending a work conference NAPTINational Association of Television Producers and Executives.
(35:07):
Just a little name drop in there. We actually spent some time and
hung out with the cast of Parksand rec at this party. The Versace
home there in Miami's where we're at. And this is us now ten years
later. On our recent trip,we had to New York and as you
could see, yeah, we've Ithink we still look good. There we
(35:29):
are in front of the tree.We were in New York with the family,
just before things started to shut downagain and join time. Speaking of
the family, this is my lovelyfamily here. They're going to kill me
for showing this picture. This isten years ago us attending a Texas Ranger
game. We shoot the show inArlington, Texas. We actually can see
the Rangers ballpark from our studios andthis is what they look like the family
(35:52):
today. This was actually taken justlast weekend and a very emotional weekend for
us. As my oldest daughter.There's my two daughters hugging each other.
My oldest daughter on the left isnow a freshman in college. A freshman
(36:13):
in college, hard to believe.And there's you know, someone asked me
recently, how are you handling that, having one of your two daughters out
of the house. I'm like,man, there are no words, you
really there are. There's nothing youcan do to prepare yourself for that moment,
there's no words that can actually describeit. And so it's certainly a
(36:35):
process that we're dealing with. Andif any of you've ever been an empty
nester, you know exactly what we'retalking about. But we still have our
younger daughter that's going in high schoolnext year. No doubt the next four
years will fly by as well.We're so glad you tune in to create,
build, and manage big announcement.We kind of tease this announcement a
(36:57):
little bit last year, but nowwe can give you the official announcement.
My new my first book. Isay my new book like I've written more
than one, but my first book. There you see it, Media Matters,
How to Leverage the Media to Growyour Business. It's coming out on
March fifteenth. Mark your calendars forMarch fifteenth to get your copy of Media
(37:22):
Matters How to Leverage the Media toGrow your Business. I wrote this book
with the small, medium sized businessowner in mind. There's so much that's
changing in the world of media.Arguably today we are the viewership is much
more divided, and we're not talkingabout political lines, just how you consume
content. You may watch content likeyou're watching this show on biz TV over
(37:46):
digital broadcast. You may listen toit like you may be listening to the
show on a radio station or apodcast. You may be watching the streaming
version of this show on bisvo dotcom on any of the devices, whether
it's Apple or Roku or you knowGoogle or you know Amazon. So many
(38:07):
different ways you can consume content.Now, so how do you, as
a business owner market your business inthis new world that's only going to get
more divided. Well, that's whatwe talk about in media Matters again.
It's due out on March fifteenth.As we get closer, we'll give you
an opportunity how you can pre orderthat book. So we're so excited.
(38:29):
It's team effort. The entire teamhere at Center Post Media, a parent
company to BIS TV and BIS TalkRadio, put our efforts into that.
So I'm excited about that, Russell. I'm excited to have another year.
We got a lot of exciting guestscoming up over the next few weeks.
Season what is a season number threeof Create Build Manners? Here we are.
(38:55):
He's excited. I am very excited. Sorry to be thrown back to
me again, but now it backto you. It's all good. Hey,
thanks so much for watching us.If you want to watch more content
or catch previous episodes, make sureyou go to bisbod dot com, b
i z vod dot com. Also, if you haven't done so already,
you can't subscribe to our podcast onany platform you get your podcast, just
(39:17):
look for Create, build and Manage. For Russell Sorrow, for Julia Grub
and everybody. I'm Scott Miller.Until next time,
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