How Tax Strategy Can Help First-Time Homebuyers Keep More of Their Money

Monica Love (00:00)

would say absolutely like screaming to the rooftop. Please look at tax strategy because at the end of the day it’s not how much money you make but it is how much you get a chance to keep right. So if you’re paying so much in taxes and the different strategies be it ⁓ tax advantages be it tax free be it tax ⁓ now whatever that strategy is that’s going to be best for you and every situation in each one of our lives has a different nuance when it comes to taxes. So yes, looking at the tax strategy is extremely important and the benefits of owning a property, a home ownership when it comes to taxes, hands down is definitely something to look at.

Dylan Silver (02:20)

Hey folks, welcome back to the show. Today’s guest is based in the Detroit metro area where she works with first time home buyers and also leads a nonprofit focused on financial literacy and education. Please welcome Monica Love. Monica, welcome to the show.

Monica Love (02:37)

Hello, thank you, Dalen, thank you.

Dylan Silver (02:39)

It’s great to have you on here, Monica, and we were talking a bit before hopping on here, but I always like to start off at the top really by asking folks how they got into real estate.

Monica Love (02:49)

Okay, so.

Oddly enough, when I was 18 years old, ⁓ my father bought me the program, the Carlton Sheets program, How to Buy Property with No Money Down. You don’t remember that program because you’re not old enough. You probably weren’t born then. But I was 18 and I went through that program and it sounded like a really amazing thing. But he had the swag, he had the temperament, I wasn’t him. So I couldn’t do it. So as I became

You know, I got into the corporate industry. I continued to work through ⁓ negotiations and that kind of thing. And I decided to go and get my license. And that helped me to get the confidence once I got the education on real estate. It helped me to get the confidence to go out and do some of the things that Carlton Sheets had taught in his course.

Dylan Silver (03:41)

What was your background in corporate?

Monica Love (03:44)

Incorporate, I led a team in the telecommunications industry where we went and negotiated ⁓ contracts for access rights ⁓ for multifamily hospitals, schools, universities, that kind of thing.

Dylan Silver (03:57)

heard

actually a number of guests, there was one in particular who was involved with telecom as it related to real estate. And you know, it’s amazing how real estate covers so many different industries and verticals. Very clearly you can see the connection between what you were doing and then moving into real estate. Did you feel like you kind of had a leg up on people who maybe had no exposure to contracts in general?

Monica Love (04:25)

Absolutely, I did because real estate gives you that exposure, you know, when you talk about easements and all of the land rights and things like that that you learn in real estate. ⁓ So yes, absolutely, I did.

Dylan Silver (04:38)

I want to ask you about getting started in real estate and then how you’ve seen your business transform over time. What was that first couple of years like and then what were some of the pivots over the years to where it’s at today for you?

Monica Love (05:42)

Well, it was scary.

because I had no clue what the heck I was doing. And at the time when I came into the business, I think it was like in around 2004, 2006, somewhere there, in there. everybody, the business was booming at that time. Everybody was getting houses. The broker that I sat under at the time did not have time to really educate me on what I needed to do to do a contract. I had no idea how to even execute a

⁓ purchase agreement with all of the nuances that went into it like the ⁓ inspections, all of the things that go into a purchase agreement. And so I was there figuring it out and my business morphed, I didn’t even know how to put together a a listing. ⁓

Dylan Silver (06:18)

Yeah.

Monica Love (06:30)

presentation or a buyer’s presentations, all of those packages and things that you have to do in order to be successful in real estate, I kind of had to figure it out. So most of the morphing that has happened in the in the industry has happened as I was learning because in 2008 when the bubble burst, I was in the midst of learning. was still in corporate.

Dylan Silver (06:31)

Yeah.

Yep.

Monica Love (06:54)

So I was in corporate, I was working real estate, but I was learning how to actually get my feet under myself. So as it was busting and things were happening around me, my business was shifting, but I wasn’t trying to establish a full-time business at the time. Right around that time, right around 2010 or so, I decided to go and get my broker’s license. And after I got my broker’s license, because by this time I know how to do the agreements, I know how to do those things,

and navigate the waters of real estate. ⁓ But at that point, I went and got my broker’s license because I wanted to be, if I had to learn it on my own, I needed to be able to get paid for my education and everything, right? So, and today I’m doing it full time. That’s what I do as real estate and teaching people financial literacy. So I don’t want to just help people get into a home, but I want to help people get into a home and keep that home because they have savvy.

Dylan Silver (07:36)

Now.

Monica Love (07:53)

financial behavior.

Dylan Silver (07:55)

Monica, think it’s so great to hear that there’s folks who are committed to helping ⁓ first time buyers learn about the down payment assistance programs. And then you also mentioned staying in the home and having good habits. ⁓ Why aren’t there more people who are gung ho over the long term about making a business out of helping first time home buyers? It seems like agents will do this when they’re starting out and then feel like they have to graduate from it. Why don’t we?

Stick with first time homebuyers, there’s so many of

Monica Love (08:25)

Yeah, well, there’s not a whole lot of money in it. There’s not, you have to, when you’re working with first time home buyers in the education, the hours that you spend in giving them the information and then, you know, they go and buy a 50, $60, $100,000 home.

you know, in this market there’s still those $50,000 homes that you could actually live in. They need some work, you know, and that’s where a lot of them will kind of end up. They’ll pivot toward those lower priced homes they’re afraid of the two, $300,000 homes, the nicer places to live, and they typically are, ⁓ you know, moderate to almost lower income folks who don’t have

Dylan Silver (08:47)

That’s true.

Monica Love (09:12)

the ability to purchase those nicer homes, those nicer properties. So that’s why people get into the business. They learn the business and cut their teeth on those first-time homebuyers and then they go on to the higher end in real estate where they can actually make some money.

Dylan Silver (10:04)

I have a hope and maybe an aspiration. have to look at this myself and dive into it further to see if there’s something there. I think right now in America, the landscape is such that there’s so many people who would like to own a home. I don’t know the figure, but it’s massive. And there’s a lot of people who maybe they’ve gone to a lender previously and they said, well, you don’t have enough credit. You have good credit, but you don’t have enough credit or you need to improve your credit or…

You know, you need X amount of money down. Maybe the lender wasn’t aware of the down payment assistance programs. And so sometimes people need to shop lenders, right? But I think that there’s this opportunity to build a business at scale, really targeting first time home buyers across every state. And I think this is like an untapped gold mine. I can definitely speak for myself and a lot of younger people.

Monica Love (10:42)

way.

Dylan Silver (10:58)

it feels like as much as there is information out there, there’s not enough because so many people would love to own a home and oftentimes the only information that we’re able to drum up is information that we’re able to find ourselves with like a Google search. But as you know, Monica, a lot of this information is not so easily accessible like with the down payment assistance.

Monica Love (11:23)

Yeah, and some of the information might be erroneous as well. So the down payment assistance programs that they have available in each and every state, right? You just have to make sure that you get that information, it’s good information, and you not only have the information, but know how to take advantage of it, right? How do you know where to go to get, you know, they’ve been talking about these 20, $25,000 first time home buyer grants and different things. How do you know where to go, how to qualify, and that’s where

comes in with having a good ⁓ lender will know what’s available in the market that he’s working in or she’s working in. A good lender will know the programs that are available for his buyer even before they ask they’d be willing to, they should be willing to share that information. So I think it’s not just that the information is not available but the good information so you don’t have to spend hours upon hours trying to figure out where it is and how to get a hold of it.

Dylan Silver (12:17)

Yeah.

The lending thing, can’t emphasize that enough. I know before I got into real estate, I had the experience of, had good credit but not the right kind of credit. I hadn’t bought a car before, hadn’t bought a home before, and so they said, you can’t, I went to one lender and they said, well, you’re not gonna be qualified. And I kind of gave up at that. But there was probably a lot that I could have done to facilitate that at a much younger age.

I want to pivot a bit here, Monica, and ask you about for folks who are in the Metro Detroit area and they may be looking at their first home, should they look at newer builds? Should they look at older builds? Should they first have an idea for how long they want to live there? What’s like the starting point for someone who’s looking at a home?

Monica Love (13:15)

everybody’s situation is different, right? So some people who are getting into their first home have a different tolerance level than other people. Perhaps someone who has not purchased their home yet, they have the income, they have the resources, they have all of the things, the credit, all of the things, and they want to have a home built. I don’t believe that there’s anything wrong with that. Work with a good lender, work with a good realtor who will help and walk you through the process. I just helped a couple to purchase some

land because they’re going to build this is their first home. They’re a young couple, but they’re very stable, very situated. So they’re able to get into that building process. know, other folks who are not quite as savvy as not quite as comfortable with that whole build out process. You probably want to purchase a home that’s already built because you do have to think about the material. have to think about every little detail when you have

Dylan Silver (14:14)

Yeah.

Monica Love (14:14)

home built right where when the home is already built you just you know make sure that it’s it’s according to your aesthetics and and your inspection and that kind of thing but you also have to make sure that you are working with a team that will help you to get into whatever that situation is where it’ll be most effective for you in the long run and be able to build up you really want to make sure you’re able to build up some equity for yourself so that you can go into your next

home or your forever home or even start investing in property.

Dylan Silver (15:29)

I’m a big fan also of the nonprofit that you have, which helps people get into their first home and also helps them with financial literacy. How did this come about for you?

Monica Love (15:41)

I tell you what, was actually by, it kind of just happened. So I am a licensed financial professional in addition to being a real estate broker. And I’m just like, and I’m a minister. So I’m just like praying like, Lord, how do these two mesh? And when I found out that 30 % of the wealth in America is in home ownership, not in commercial properties, but in home ownership,

I’m like, that just goes together. just makes sense. If 30 % of the wealth is in homeownership, then I need to teach people how to become homeowners while I’m also helping people to understand how to ⁓ maximize their finances and know how to save money as well as, of course, we already know how to spend, but how many of us know how to save? How many of us know how to do the B word, you know, budget? So helping people understand those nuances of life.

⁓ It kind of meshed into that as I was going into the schools to help 12th graders know how to get into the business of real estate. Most of their parents were renters. They were lifelong renters and that’s all these kids ever thought that they would ever be. So that is kind of how the nonprofit morphed into that because I already had a nonprofit for ministry and I just changed it over to an agency to help people actually within the community.

Dylan Silver (16:53)

Yep.

I have a granular question. Maybe give away some of the gold here, Monica, but not all of it. How much tax strategy do you personally look at? And also, would you say that the average person should be looking at tax strategy, even if they have a W-2 job?

Monica Love (17:27)

would say absolutely like screaming to the rooftop. Please look at tax strategy because at the end of the day it’s not how much money you make but it is how much you get a chance to keep right. So if you’re paying so much in taxes and the different strategies be it ⁓ tax advantages be it tax free be it tax ⁓ now

whatever that strategy is that’s going to be best for you and every situation in each one of our lives has a different nuance when it comes to taxes. So yes, looking at the tax strategy is extremely important and the benefits of owning a property, a home ownership when it comes to taxes, hands down is definitely something to look at.

Dylan Silver (18:15)

I know in my story I kick myself because I don’t know how many tens of thousands of dollars as a W-2 ⁓ employee I would have saved if I had even thought of tax strategy. I think most people, especially when you have a W-2, you don’t even bat an eye about tax strategy because you think, well, it comes out of my check and this is how much I have to pay. ⁓

Monica Love (18:37)

That’s right.

Dylan Silver (18:41)

whether it’s through operating a business and losses that the business may ⁓ incur or deductions that you can take through the business or whether it’s real estate. There’s so many ways where you’re really entitled to more of the money that you earn than people realize. But Monica, we are coming up on time here though. Where can folks go if maybe they’re in the Metro Detroit area and they’d like to reach out to you or if they have questions about first time home ownership?

Monica Love (18:47)

Absolutely.

Absolutely.

Yeah, so my email address is monica at monica love dot co not com just co so co so monica with a c at monica love dot co and my website is the same monica love dot co so that’s www.monicalove.co

Dylan Silver (19:28)

Monica, thank you so much for coming on the show here today.

Monica Love (19:31)

Thank you for having me, Dayla, and I appreciate it.