The Ramsey Show Highlights "You Have No Mortgage, Pay Off Your Debt!"
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Nov 14, 2025 Josh, a motivated caller and former mortgage-free homeowner, seeks advice after taking out a HELOC for renovations. He shares his financial challenges, including hefty private school tuition. Rachel, the host, probes into why he borrowed after being debt-free and emphasizes the importance of paying off the HELOC aggressively. They discuss practical strategies to expedite debt repayment, the risks of rolling debt into a mortgage, and the reality of deep budget cuts. It's a candid conversation about financial priorities and avoiding the debt trap.
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Return To Baby Step Two Focus
- Stop retirement and college savings while on Baby Step 2 and focus all extra cash on the debt until it is gone.
- Cut discretionary spending hard and throw every available dollar at the HELOC to become debt-free quickly.
Paid-Off House, Then A Costly Remodel
- Josh and his wife paid off their house, then borrowed $105,000 with a HELOC for a remodel and spent cash, putting them back into debt.
- Their interest-only payments of about $450 a month leave them making no principal progress on the $65,208 balance.
Cut Spending Aggressively Now
- Live on an extreme temporary budget: stop eating out, cut subscriptions, shop cheap, and pause vacations until the HELOC is paid.
- Find at least $2,000 more per month to apply to the debt by reallocating spending or increasing income.