Real Estate the Ramsey Way - We Found Mold In Our Home One Month After We Bought It

Episode Date: June 9, 2025

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Dave Ramsey here and welcome to another episode of Real Estate, the Ramsey Way, where you'll learn how to make smart home decisions, avoid costly mistakes, and navigate homeownership with confidence. Up next we have Melissa in Charleston, West Virginia. Hi, Melissa. Welcome to the show. Hi, how are you? Doing great. How can we help? Yes. So I recently purchased a home in West Virginia about a month ago. And since living there, my family and I have got really sick experiencing allergy-like symptoms. That's a long story short, ended up getting someone that come and test for mold. And it's very high numbers in stature bachros. I don't know. I'm probably bitchering that mean, but it's the one that's really, really dangerous. So now I'm in the flip other side. I'm post-closing. I did go through the property disclosure. It was as is, and it was a flip.

And also I did also give a home inspector as well. And this is through a VA loan. So now I'm trying to figure out if I should do a mold remediation myself or go ahead and do a deed in lieu of foreclosure situation. Because, now, I don't feel comfortable staying there at all. what else is concealed in this house? I don't know. And turns out the guy that flipped it has a horrible reputation around the community for doing basically pig lipstick on a pig flip. So when you did the, when you did the inspection to purchase the home, it didn't come up on the

inspection, but now it is. Can you clarify that for me? Yeah, the mold is on plain view, but from a lay person, if you look at it, it looks like mildew or maybe like dirt, just like a dirty basement. But the second inspector that came in said, this is definitely mold. It's same plain view. Nobody called this. He said the appraiser could have called it, but I know they're there for just evaluation purposes. But he said that, you know, you potentially have a case. And I've contacted attorneys and they are all pretty much that I don't have a case because it's a buyer beware state, which I wasn't.

I didn't know what that meant. So the onus is on the buyers and it's not a lot of consumer protections for us in West Virginia. Oh, shit. Wow. Have you had any estimates on what it would cost to try to go through? And, I mean, it's such a frustrating part of the, you know, that whole process of renovation. But have you talked to anybody? Yes.

So I had an adjuster come for, with my homeowner's insurance, but of course they deemed it. preexisting. And the adjuster told me that the basement has not been up the code. So the cost of get going to the basement is like 20,000 plus. And the mold remediation itself would be 10K plus. Is that how many? Okay. So let's keep, I think for for now, we keep the mold separate from the basement not being to code and find out. Because here's the thing. If you're the thing, if you get the mold out of the house and you're ready to sell the property, then you can say, you can sell it, you can feel good about it. There's no mold here. The other question, but I did have the question. So you're telling me your inspector missed the mold and missed the fact that the

basement wasn't to code. Yes. And he said one of my questions before I hired him was, you know, how long have you been doing it? You know, what are your, just asking his history of his work. And he's like over 20 years. And I looked at reviews. He has great reviews. great reads on the BBB and all this stuff. And I was like, are you approved by the VA? And he was like, yes. And I verified everything and everything checked up on paper. But yeah, none of that. And there's nothing on him. There's, he's completely, there's no liability towards whoever did the inspection. And that's what the lawyers are saying. But they are saying that the likelihood of it of winning in court is low because of that caveat on tour buyer beware thing

in West Virginia and the fact that they have no duty to disclose mold in West Virginia. And what's the point of the Dackham inspection? What's the point of it? Exactly. Exactly. You would have to hire a mold inspector on top of the regular. Oh my gosh. And a radon inspector and whatever other inspectors

separately in order to do this. And they said it was a law just passed with the Supreme Court back, I think 20, 20, just last year it was something recent that passed. But my realtor and the agency and his broker, he told me that I did have something and that I should pursue it. But my thing is going to further debt with litigation going back and forth with these lawyers, which is a shot in the dark or just take an L and I mean it's going to dig my credit

but I need to get out of it because we're essentially homeless. Why can't you just put it on the market? You've purchased it. Can't you just put it back on the market for sale? Why does it have to go into foreclosure, I guess is what I'm saying? Because I don't, I'm going to have to disclose it and it's not remediate it. So also I asked that question. They said a lot of lenders won't allow you,

won't lend on a home with mold, with active mold. Now the mold, I don't know if it's active because I've got a de-humidifier down there and I've sealed up where moisture may have gotten in. But I don't know who deemed it active or not, but you can see it now because I've pulled paneling off. It was hidden. It was even more like the obvious mold that you would be behind paneling. So what if we said this?

What if we said, let's get a couple of opinions on what it's really going to cost to get this remediated? and then do you have any money anywhere? No, and the money I am getting, I've run a business out of West Virginia. And right now we're living with my man and we're going back in four of two and a half hours between Columbus and where we're at every other day

so I can still take clients and that money is going towards gas and food because I've had to take the kids out of school because they are allergic to it. And I got some allergy tested to verify what I'm saying. You know. Yeah. How much are you making a year, Melissa?

Um, I make, so I'm a disabled veteran. So on top of that, I would say about 80, 70, 80,000 a year. What do you get for the disability per month? About five. Okay. So. Just under five is like four, nine or four eight, something like that. Okay.

And then what do you take home from your actual job, take home? Um, per month. I would say about five. about five. So we've got 10K a month. How many kids? Two. And how much is this mortgage out of your take home? 15.500? Uh-huh. Okay, that's good. This is Melissa, I almost would just go rent somewhere. I mean, be paying the mortgage, go rent, because this isn't feasible. The two and a half hour thing, I think that adds stress. I think that's like, that's exhausting everybody pulling the kids out of the routine. I mean, that's just miserable. I would just go rent somewhere, go rent a one, two-bedroom apartment, knowing it's short term.

Cheap, cheap, cheap. Yes. Just knowing like, this is what we're going to do, just to have some stability from where you were. And then they can get back in school. Yes. And then from there, gosh, I would probably get even a second attorney's opinion. And sometimes, you know, they'll take cases and with the, you know, with what, you know, is one in court. If so, then that's how they get paid.

So you're not having to go deeply in debt with all this litigation and stuff. So maybe even from a different standpoint from a payment perspective. You can find someone different on that end. But I would probably still pursue that because this doesn't, this feels like a lot of negligence on the end of your inspector, even though the mold thing, which I guess is the biggest part of all of this, if he doesn't have to disclose it or find it, that has to be separate in West Virginia.

I mean, that's just bizarre. And then I would be saving it. And I would do the cheapest renovation you can to get this mold out. That would be safe to resale so that you can, in good conscience, sell this home. Would you want to stay in the home? if you did get the mold all clear? I don't, and I don't want to stay. I love the home.

That's why I brought it. But I no longer want to stay there because now with this man's reputation being the way it is. You think more things will be wrong. Sure, you don't know. You don't know, yeah. So I would save Melissa really aggressively,

stage by stage, be getting, redoing this house from just the mold, right? Not the up-to-code basement thing. You know, someone can renovate that if they want, but just getting the mold out, put it on the market, sell it and in good faith to say, yeah, you know, this was cleaned up. Yeah. You don't know. I mean, yeah, the guy has a terrible reputation. You don't know what else is there, but you don't

know, right? And if the inspector finds something else, then we can deal with that. But I would put it on the market and try to sell it just to get out of it. And we'll give you every dollar so you can really plan this $10,000 a month to make that happen. Yes. Oh, I'm so sorry, Melissa. Such a headache. Terrible. Terrible. Terrible. Joel is in Portland, Oregon. Hi, Joel. Welcome to the Ramsey Show. Thanks for taking my call. Sure, man. What's up? Yeah, I'm just trying to decide if it's the right time to buy a house.

I know that's what you were just talking about a little earlier. But I've had different people telling me different things. I have enough money to buy a house. They said, and I heard as a horrible financial planning firm. For real. Yeah. So, I mean, there's just different arguments about, I don't know anything about real estate, but I hear different arguments about how inflation,

is going to really change the price of houses, obviously that's true to a certain extent, but then that mortgage rates are going to go up significantly and now's the time to buy. Okay, you said you have the money to buy a house. Are you debt-free? Yes. All right. What are you looking to do? Tell us what you want to do. How much do you have saved and how much of that's the emergency fund? I have 55,000 saves, including an emergency fund. including the emergency fund.

Okay, how much is the emergency fund and how much is the down payment? The down payment, it's a VA loan, so I don't have to do a down payment, but I was thinking of about 40 grand down on the down payment. Okay. All right. Let me help you. A VA is the most expensive loan. I would not do that.

I'd put 40 grand down into a Fannie Mae loan. Thank you for your service to the country, but don't let the Veterans Administration screw you. Understood. Interest rates higher and fees are higher. Don't do it. Instead, just let your veterans' benefits do some other things for you. Thank you. But I would get a Fannie Mae, FNMA, a standard conventional loan, 15-year fixed rate with 40 grand down.

What do you make? 330, $3,000. Wow. Were your payments no more than a fourth of your take-home pay on a 15-year fixed? If you do that, I would buy yesterday as soon as you find the right house. Yeah, make sure this emergency fund is right, because $15,000 for $330,000. a year of mortgage doesn't sound quite right. Yeah, you need three to six months of expenses.

Are you single? Yes. What do you do for a living? I'm a position. Good for you. Okay. Really good. Are you in a relationship of any kind?

No. Okay, good. All right. Because that's going to affect the buying decision. That's why I'm asking. It is. That's a good point. So, but, but yeah, you go buy.

I would go buy something now, Joel. I think you're in a position, too. I don't, I cannot think of a single reason to weigh. house prices aren't going to go down. If interest rates go down, you just refinance. Yeah, big deal. Yeah, you date the rate and marry the house. Sure, sure.

Any opinion on physician loans? Physician loans? All that is is just a no qualifying. As long as the interest rate is strong, and it's a 15-year fixed. I got no problem with it. But sometimes they up the rate because it's a guaranteed issue. They go, oh, you're a doc. You can pay it automatically.

They don't check anything. but then they kick the rate on you a little bit. So make sure the rate is competitive. So talk to Churchill mortgage and ask them to run you the numbers on a physician and on a regular Fannie Mae, and then just compare the two and it'll tell you right. The number will tell you what to do. But that's what I would do in that situation. Congratulations, man.

I think that's great. Very, very good. Yeah. I personally don't think that house prices are going to be anything in January except higher than they are in December, anything in February except higher than they are in January, anything in March except higher than they are in February. Am I getting my point across? They're going up.

They've been going up. They've continued to go up even though the market was really slow. House prices have continued to climb nationwide. Total homes for sale right now in America, 953,814. Average 15-year fixed rate, 5.6% right now. Median home price in America today, 424,950 sounds like 425 to me. Okay. And median days on the market. Houses on the market. How long you think a house stays on the market right now, boys and girls? Everybody give me a guess. Here's the actual number. Fifty-eight. Put a house on the market has gone in two months. That's the average right now, the median. People think that that's slow now because they got used to the, but they got used to the ridiculousness of being able to sell a house in two days.

Yeah, 58 minutes was the time on the market back during the Fauci pandemic. I mean, it was crazy out there. People came out of their houses like Baptist looking for a casserole, man. They were buying houses like crazy. So it was nuts out there. But yeah, those days are... Those days are gone. I hope we don't see that again. That was a market disruption.

Wild. It was not a healthy transaction environment. You need a healthy transaction environment where a willing buyer and a willing seller with no duress are having a negotiation. If that was your first, you know, introduction to the real estate world during that time, you've got a lot to adjust. Yeah, your brain is upset. Yeah, you've got an upset brain. But that's a good, you know, there's a million houses on the market right now in the

United States. And there's probably about two million people looking for a house. It's definitely a seller's market. Translation, prices go up, not down. Let's go. It's called Supplied Aband Curve. They were supposed to teach you that in seventh grade economics, but someplace don't. So supply demand curve works like this. When there is a shortage, prices go up. When there is an

overage, a glut, oversupply, prices go down. That's the supply demand curve. That's simple. So we have a million houses on the market, 953,000, about two million people looking for houses. And this median house price is blowing my mind. $425,000. It feels like 20 minutes ago is $250,000. Yeah. Well, it feels like it doubled, yeah. Yeah. Well, I mean, everything's 20 minutes ago when you're 65. Yeah, it's like everything's in the rear of your mirror. But, yeah, it's crazy. I mean, that's not, I mean, it wasn't even 20 minutes ago. I mean, in 20, let's see, 22, we bought our house for about that much. And then when it was time to sell it, it was double.

Yeah. 2020? We bought it in 2018. And when we sold it to come here, it doubled. Okay. But that's wild. That's not normal. Yeah, well, that's seven years ago. Yeah, doubled in seven years. No, no, no, no, double before you came. Yeah, 2018 to 2022. Four years. I bet you, I bet, well, I have to look it up.

I'm curious now. But anyway, that's what's going on out there. An average fixed rate home on 15 year, 5.6. That's down. They're down. Yeah, it's a good time. Get out there.