So the real estate world has a lot of kind of confusing terms, and it can feel like buying a home is very intimidating because it's like this whole other part of life.

And if you're not familiar with it, it can feel very overwhelming. And so it's important to know these terms and understand how housing works before you get into it.

Because for a lot of people, this is one of the biggest financial decisions that they're going to make.

And when you buy a home, usually it's the largest purchase you'll make in your lifetime.

So today we're going to talk about the basics.

And this is everything from what the principal means to interest, to PMI. All of these terms are going to talk about the basics, and this is everything from what the principal means,

to interest, to PMI. All of these terms we're going to talk about because when they're less

mysterious, it's much more approachable when you go to buy a home. And before we jump in,

be sure to like, subscribe, and share this episode with a friend. All right, we're going to start

off with the basics. What exactly

is a mortgage? Well, a mortgage is a type of loan that you take out for a home. And a mortgage is the

one type of debt that Ramsey says is okay, right? Because we are all about being debt-free.

But when it comes to your mortgage, that is the one

type of debt. It is okay to take on. And there's lots of different types of mortgages out there,

but your mortgage, the basic definition, it is the money that you borrow to buy a house.

All right, what percentage of your take home pay should be going towards housing costs? So when you

go to buy a home and you take out a

mortgage, they're going to break your mortgage up into payments. And so it's really important to

look at that payment per month and make sure it's a good ratio for the income that you're bringing in.

Because if it's too high and so much of your money's going to your mortgage, you're not going to

have a lot of money left to do things like pay off debt or to save or to live off of. And so much of your money is going to your mortgage, you're not going to have a lot of money left to do things like pay off debt or to save or to live off of. And so the 25% rule is always what I go by.

And this includes HOA insurance and all of that. Okay. So 25% of your budget really should be, of your

...