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This Grad Student Bought a Home at the Start of His Doctoral Program

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In this episode, Emily interviews Ethan Muller, a first-year doctoral student in theology at Villanova University. Ethan and his wife purchased their first home outside of Philadelphia at the start of his six-year program. Ethan shares the details of his and his wife’s financial profile, their emotional readiness to become homeowners, and their plans for the home once he finishes his program. After local mortgage lenders were unable to work with him due to his student status and 9-month stipend, Ethan connected with Sam Hogan, who knew exactly how to make the lending process much faster and easier. Ethan and Emily close the conversation by discussing which other PhD students should consider home ownership.

Links mentioned in the Episode

This Grad Student Bought a Home at the Start of His Doctoral Program

Teaser

Ethan (00:00): Especially in the shifting landscape of being an academic, you know, you could apply for something and get in, what does that look like with your house, and what equity did you have time to build? Which is also why before the program, it felt like a big deal to us to just simply attempt to buy a home.

Introduction

Emily (00:24): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:53): This is Season 23, Episode 3, and today my guest is Ethan Muller, a first-year doctoral student in theology at Villanova University. Ethan and his wife purchased their first home outside of Philadelphia at the start of his six-year program. Ethan shares the details of his and his wife’s financial profile, their emotional readiness to become homeowners, and their plans for the home once he finishes his program. After local mortgage lenders were unable to work with him due to his student status and 9-month stipend, Ethan connected with Sam Hogan, who knew exactly how to make the lending process much faster and easier. Ethan and I close the conversation by discussing which other PhD students should consider home ownership.

Emily (01:40): By the way, I’m hosting an AMA with Sam Hogan on Thursday, February 19, 2026, so that he can answer all your mortgage and first-time homebuyer questions! Sam is a mortgage originator specializing in early-career researchers. Anyone who is considering buying a home is welcome to attend, whether that’s in the near or far future. Register for the event at P F f o r P h D s dot com slash mortgage.

Emily (02:09): The tax year 2025 version of my tax return preparation workshop, How to Complete Your PhD Trainee Tax Return (and Understand It, Too!), is now available! This pre-recorded educational workshop explains how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. Whether you are a graduate student, postdoc, or postbac, domestic or international, there is a version of this workshop designed just for you. While I do sell these workshops to individuals, I prefer to license them to universities so that the graduate students, postdocs, and postbacs can access them for free. Would you please reach out to your graduate school, graduate student government, postdoc office, international house, fellowship coordinator, etc. to request that they sponsor this workshop for you and your peers? You can find more information about licensing these workshops at P F f o r P h D s dot com slash tax dash workshops. Please pass that page on to the potential sponsor. Thank you so, so much for doing so! You can find the show notes for this episode at PFforPhDs.com/s23e3/. Without further ado, here’s my interview with Ethan Muller.

Will You Please Introduce Yourself Further?

Emily (03:45): I am delighted to have joining me on the podcast today, Ethan Muller, who is a first year PhD student at Villanova University. And Ethan is here with a home ownership story, and you all know how much I love a home ownership story for graduate students. So that’s our topic for today. We’re gonna get into all the dirty details. So Ethan, welcome to the podcast. Will you please introduce yourself a little bit further for the audience?

Ethan (04:08): Yeah, thanks for the kind introduction. My name is Ethan. I’m a first year doctoral student at Villanova, Pennsylvania, which is wonderful. It’s right outside of Philadelphia. I spent most of my time before this doing grad work in the Boston area with my wife and went through the incredibly hard process of applying to PhD programs and was lucky enough to, uh, wind up, I guess at Villanova. Yeah.

Emily (04:35): Can you tell us just a tiny bit more in that background question about maybe the timeline on this? Like when did you finish undergrad? What were you doing between then and when you applied for doctoral programs and also when you got married?

Ethan (04:48): Yeah, that’s a great question. My then girlfriend and I decided that we did not wanna go to grad school, um, as, uh, anything other than a married couple. So in the, I guess it was early spring of 2023, we both applied, um, to graduate programs. She got into Northeastern University and I got into a seminary on the north shore of Boston. So we got married in the spring of 2023 and went to grad school from 2023 to 2025. I applied to PhD programs the fall of 24 and heard back in the spring of 25.

Emily (05:27): Great. And what is your wife doing now? Is she also doing more school or has a job?

Ethan (05:32): My wife works in marketing. She has training in clinical psychology. She’s worked previously as an ABA therapist, wanted to switch it up, wanted to do something different. So now she’s in the field of marketing, which is great, expanding her CV a little bit. Um, we both during our grad school days, worked at Whole Foods Market, which is our claim to fame. It was our <laugh>, our our era to save a little bit of money while we lived on campus and, um, that kind of let her see some different experiences in different fields and corporations. So.

Why Buy a Home as a First Year PhD Student?

Emily (06:01): I love that story actually. It’s, it’s so often that I find that work experience itself is what opens our minds to other possibilities for how, you know, areas in which we might work or apply our education and so forth. So that is awesome. Thank you so much for that, um, backstory. And so when you’re, you know, you’re into this PhD program and you’re moving to Philadelphia, what made you interested in buying a home at that stage?

Ethan (06:24): Yeah, uh, it’s quite rare, especially as an academic to, there’s only a certain few places you can really go for school, depending on the field. I mean, sometimes people are limited to, Hey, I’m moving to the west coast. Other times it’s Chicago. It, it’s really rare. So I’m in a very niche field of theology where I knew that Philadelphia was a place where I could go one, because I was born and raised in Pennsylvania. So it became a very intentional part of my pitch to being accepted, um, that Pennsylvania was a place not only that I loved dearly, but wanted to return to. Um, so my wife and I really pushed hard to get into Villanova. I was very honest with the faculty there. Reached out, uh, quite a few times in order to make strong connections to put my best foot forward. Pennsylvania was the place for us. One, because this is not just a me decision, it was my wife as well. But two, the cost of living was much different than Boston. We loved the Boston area, it was brilliant. There’s so many wonderful opportunities and connections, but Pennsylvania really offers a good access to many different areas of the country, while also having a lesser cost of living, which for people who wanted to own a home, uh, that, that was pretty key for us.

Emily (07:39): So, but why, even though, you know, you’re, you’re sure you wanna put roots down in Pennsylvania and you, you know, you’re presumably there for the length of your doctoral program at a minimum. Um, why buy? Because renting is obviously the default and easier decision.

Ethan (07:52): Yeah, that’s for sure. We rented all up until that point, uh, most of the rhetoric that was given to me was, you can’t buy unless you have a certain amount of time, which I’m not sure how accurate that is or how many times other people have heard that. Like, oh, you need to have five years or 10 years when you buy. Um, and we had some people come alongside us and say, Hey, maybe that’s not so true. If you have time to save money while living on campus as a grad student, even if you’re in a next place for three to four years, no matter where we were gonna go, we felt like we had a enough of our debt covered to really put a foot forward into buy to make an investment. It just felt like something we were ready for.

Emily (08:34): I heard the same thing, um, the same rule of thumb around five years, or it could be even longer in some cases. Um, and I agree that that is off-putting for a lot of people starting a PhD program because they don’t, it could be only five years or it might be a little bit less or maybe a little bit more and we just don’t know. But I agree with you that it’s, it’s actually much more nuanced in that first, I mean, as a rule of thumb, it’s fine, but you always have to take a rule of thumb and then go into your specific market and your specific situation and really drill down into that. And the other thing is that that rule of thumb really comes from the transaction costs of buying and selling within a short period of time. And how likely it is that the appreciation of the value in your home is going to overcome those very high transaction costs. Very legitimate question, but the kind of corollary to that is like, well, maybe you don’t need to sell the home just because you finished your doctoral program. Like one, maybe you’ll stay in the area, you’ll still use the home. Two, maybe you’ll decide to rent it out. Like just because you finished your program doesn’t mean you actually have to sell and incur those transaction costs anyway. Probably some things that you were also thinking about when you were making this like evaluation.

Ethan (09:37): Yeah, one of the things for us was it’s whether you’re there for three years or four years, it doesn’t have to three to be a three or four year investment. The, the, the investment of the house can last much longer than that. And I think in the shifting world of academics is we saw, especially with Zoom, there was capacities to have an academic role while being in a singular area. So even though, uh, you know, who knows what’s happening with education as a whole nowadays, we knew that my wife and I could, she could find a job that was remote. I could find an academic job that was remote. So putting down those roots and investing in the house seemed more probable than let’s say 10 years ago.

Emily (10:11): Hmm. I totally agree. Yeah. Thank you for bringing up the changing work norms that we’re dealing with <laugh> and yeah, you’re not the first person as an academic who I’ve spoken to who is either working remotely or open to working remotely. Um, you know, within their roles. You mentioned that you had been in a master’s program, you were also working at Whole Foods, um, you of course have your wife’s job and your like stipend offer from your doctoral program. So putting that all together, like what was your financial profile that you kind of like presented as like a prospective homeowner?

Financial Profile as a Prospective Homeowner and Grad Student

Ethan (10:41): Yeah, I’m, the biggest aspect to my wife and I’s homeownership profile was that we didn’t have any school debt. That was one of the biggest things for us. We went to grad programs where there was open funding for us where we, we really went to the places where we got the most scholarships and we could pay off the debt as quickly as possible. Um, along with that, we had some strong savings in a couple investments, but really the thing I think that spoke the loudest was we had good credit. We had years of credit history and we had no debt and no student loans. Um, which really I think every lender we talked to was really happy with that. Um, because you don’t realize that the common norm, at least for a lot of academics and a lot of my friends has been there, is so much, there’s so much debt and there’s so many things that can get in the way, uh, of putting down a down payment or even just paying for an appraisal and things of that nature. So my wife and I went into the graduate season knowing that if we wanted to buy a house, we had to focus on debt. So we’ve started paying off our debt while we were in grad school working at Whole Foods. That was, we worked alongside that probably 30 hours a week just to supplement and slowly pay that off. So when two years was up, um, we wouldn’t have any student loans.

Emily (11:58): So if, if I, if you don’t mind, um, when did you acquire the student loans? Was it only from undergrad and you managed to, you know, okay, so just from undergrad, so that’s great. So you were in your master’s programs, you had your offers from there, whatever the funding packages were, plus you were working 30 hours per week on top of that, and that’s how you managed to repay the prior debt.

Ethan (12:20): Yes. Uh, it’s a hard road <laugh>, it’s a hard road that I’m sure many other people in grad school and in doctoral programs feel as well. Um, but I also think it’s really important that when you’re in these big metropolitan cities for academics, there are part-time jobs that are really accessible. Whole Foods has a great starting rate. They started me off at $18 an hour with zero experience and gave a discount. So there’s ways that you can make things work.

Emily (12:44): Then tell me a little bit more about your income, if you don’t mind. ‘Cause you have a two income household and we’re talking about Philadelphia, so yeah. How much are you guys making together or individually?

Ethan (12:55): Yeah, so my stipend is a nine month stipend. I know each school does it differently. I, these things fluctuate, but I’m at $30,000 for nine months and then the summers, there’s still coursework and things of that nature. But you do have a capacity to go and get a job or just internships, different funding at the school. My wife works in marketing. She’s around 45, I would say 40 to 45 depending, because you know, there’s incentives in different, um, qualifications for that. So all around we’re probably $70K a year, uh, on a good year. So it’s, we are a little bit outside the Phil- City of Philadelphia. That’s one of the beautiful things. Um, I go on the turnpike for a little bit and I can get to school, which is very, very nice. Uh, one of the benefits to doctoral work, so we are in a more rural area that has, uh, less living costs than, uh, downtown Philly would.

Emily (13:51): Hmm. Let’s talk about that. Home selection and the location is certainly part of it a little bit. So you have, you know, around $70,000 a year able to demonstrate on your paperwork that you’re gonna be earning um, in a year. And so like what, like price, because I, I haven’t even kept up with, I know interest rates are kind of like shifting now. So what price range does that enable you to buy in? And then what did you like ultimately select and, you know, share whatever you would like to about the home that you actually purchased?

Ethan (14:17): Most of the homes in our area, which is central Pennsylvania’s a very interesting real estate area because it’s low inventory, but high demand. So things go very quickly and they’re normally listed at a premium, which is similar to a lot of places nowadays. Um, we were looking in the, our, our top number was 330,000. That was the max that we could do. And now things depend, are you working to, is the price more loose? Are they, is it gonna sell quickly? There’s all these things that go into it. We ended up buying at that price, which was good for us, but it was also a place where if we were going to spend the extra money, it had to be move-in ready and it wasn’t necessarily a flip sort of investment. We were able to secure a house within a day. It was only up for a day. Very competitive market. We had to see it the day of for 330,000. So.

Emily (15:09): Yeah. So of the down payment, you don’t have to gimme the exact figure, but was it in like the 3 to 5% range of like the minimum for a conventional loan? Or was it like higher than that?

Ethan (15:19): It was very interesting. So the sellers of the house wanted a really high earnest money deposit, so it felt larger on the earnest money deposit end. I think the earnest money deposit was somewhere around 3%. Um, and the total down payment ended up being I think 7%.

Working With Mortgage Lenders as a Grad Student

Emily (15:40): Interesting. I understand that you ended up working with my brother Sam Hogan, um, for your loan and that’s how we got connected. But I’m wondering, you know, you told us you make, um, $30,000 over nine months. Is that W2 income or is it fellowship or like what’s the reporting like nature of the stipend?

Ethan (16:00): Yeah, that’s a great question and something I had to figure out early on when I reached out to lenders. It is, I am an employee of Villanova University, which is very helpful, I would say to anyone who’s applying to programs or once you get in, you can immediately reach out and ask ar what your HR, what your status will be. Um, Villanova’s really student focused and friendly, where they made sure based on doctoral students complaints and questions so forth, that they were employee status and not just independent contractors, um, which was very helpful. So it, it is W2.

Emily (16:35): Okay. I know that makes it so much simpler for lenders, so much simpler. But I’m wondering why you ended up working with Sam who kind of has like a specialty in this area. Did you have trouble working with local lenders? Like what went on on that front?

Ethan (16:47): Yeah, local lenders were incredibly friendly, but not always well versed in my situation. Uh, I didn’t run into any bad people, but I was forced to go online and somehow, you know, find this podcast and then find Sam and Sam was incredibly helpful and knew exactly what he needed from me. A lot of other lenders, I spent a lot of time trying to say, this is the situation, these are the documents I have, this is what I’m trying to qualify myself as. And they were wanting to reach out to the school. Would reach out to different people in my program and reach out to me a lot of the day. Sam already had a checklist of what he needed and how he was gonna get it done, and it went very smoothly. So the local, local agents and lenders were great, but it was, it was quite complicated with them.

Emily (17:33): Hmm. So you were kind of having to educate them about what the situation is, whereas Sam already deals with this day in and day out and he, he knows what’s going on. Um, was it the nine month stipend that was like giving people some pause?

Ethan (17:46): Yeah, a lot of people because it wasn’t 12 months and because it wasn’t medical. That’s one of the things I ran into as well. I’m in a humanities field, which I think some lenders rightfully so see as a bit more, uh, volatile. Um, it was brought up at one point that it was an issue that it wasn’t for a MD or a medical doctor that they wouldn’t be able to sponsor or help with. So there was a, a slew of things that I ran into in which people were hesitant to lend

Emily (18:19): Yeah. They didn’t have like a box that you fit in like neatly, but Sam Sam’s very familiar with all this, so yeah. I’m really glad to hear that he had like the checklist. He was able to like move quickly and everything. Is there anything else you wanna say about the process of like securing the loan or like any of the, the, you know, the contract period or just anything about else about the home purchasing process

Ethan (18:41): With the home purchasing process, I think sometimes, especially as an academic where most people are tight on money, I would say make sure you know what you have. Uh, it was often for me where your agent is asking you, are you okay with this? Are you okay with that? And if the home buying process is quick, know what your yes lines and no lines are, know what’s uncomfortable, know what is uncomfortable. Um, even with Sam, Sam was great helping us wait for a good rate, just waiting for a good rate nowadays is incredibly hard and, and can be very stressful. So knowing for you, this is the last day I wanna lock my rate, this is the last day I wanna worry about this. It just sort of having a strategy and not, um, it can be just really stressful to look at the lack of money that you have instead of what you’re comfortable with. So I would just offer the encouragement to be okay with what you have and, and plan for, um, using that in the most appropriate way.

Emily (19:35): Yeah, I totally concur as, especially in like a fast moving market, like what you’re describing, you really have to have given thought in advance to like what is a boundary, what is a yes, what is a no, what is a need, what is a want? Like all of that stuff when you’re, um, yeah, selecting the home that you’re gonna be living in for at least a few years.

Commercial

Emily (19:54): Emily here for a brief interlude! Tax season is in full swing, and the best place to go for information tailored to you as a grad student, postdoc, or postbac, is PFforPhDs.com/tax/. From that page I have linked to all of my free tax resources, many of which I have updated for this tax year. On that page you will find podcast episodes, videos, and articles on all kinds of tax topics relevant to PhDs and PhDs-to-be. There are also opportunities to join the Personal Finance for PhDs mailing list to receive PDF summaries and spreadsheets that you can work with. Again, you can find all of these free resources linked from PFforPhDs.com/tax/. Now back to the interview.

Initial Experiences With Homeownership

Emily (20:46): So you’ve been a homeowner for like, we’re recording this in November, 2025, so a handful of months now. Um, how have you found the experience? Has there been any like surprises, like positives, negatives?

Ethan (20:59): As far as negatives, I can’t say there’s a whole lot. We’re still very new. We moved in in September, so there’s not a whole lot that we can say that has gone wrong, thankfully, because that’s not always the case. Positives is there’s always things to learn. So if you’re an academic, you’re in a good spot because you must like learning and owning a home is a learning process. One of the things that we found really beneficial about having a home and making this step has been the sort of accomplishment of it, of it can feel so difficult to finding a home in this market that there is a real relief that once you get into a home you maybe haven’t even thought about what you’re going to do with the home. You’re just so happy that you have one. And I think one of the positives is once you get into the home, it really is, uh, an anchor and something to be proud of and something to hang your hat on that you went through the process because it’s so multifaceted and a lot of it was out of my vernacular interest rates and, and I, I didn’t know what an earnest money deposit was if you asked me 12 months ago. There’s a lot of that that you can accrue and I think it makes you well versed to help other people, but also look whether it’s time for your next house, I feel so much more capable, uh, in reaching out to lenders and agents and even with my own finances, it makes you dive deeper into sort of your whole inventory of knowledge.

Emily (22:24): Yeah, that’s very true. And we touched on this a little bit earlier, but do you anticipate this home to be something that you live in just while you’re in graduate school? Um, or so do you definitely see yourself moving at the end of it? Do you definitely not see yourself moving it? Are you open to multiple possibilities? It certainly sounds like you wanna stay in the area, but what about like this specific home?

Ethan (22:45): For the specific home we, it is a four bed, three bath, now, it’s technically two and a half bath. Um, I think they bump that number up on Zillow for the, for the looks of it, but it has space. So one of the things that we’d always consider is this could be more of a investment property in the sense of it was not perfect, but it could use some cosmetic updating. So when we sell it, we certainly could do some things in that realm. We’d love to stay in the house. I’m in a six year program, so at least for that long, um, outside of that, Pennsylvania’s a good area for postdoc research as well. I’m not gonna try and predict where I’m going, but it’s in a good area. It’s in a growing area. We felt like if we bought this house in six years, this area, we’ll still have a lot of people looking for a home, especially a single family residence. So we feel comfortable that no, no matter which way it goes, we’re just gonna put as much cosmetic work into the home as possible and move on from there.

Emily (23:43): So it sounds like you have a happy, happy scenario. Like if you end up staying longer than six years, that’s great. You’ve made a choice that probably will work for that situation or if you end up leaving after six years, that’s all you also thought through that scenario. This is something I was exposed to when I read, um, the First-Time Home Buyers Handbook, I believe is the title, and it’s by Mindy Jensen and Scott Trench over at BiggerPockets. Just even, it’s like in the introduction of chapter one, first thing I learned in the book was like, think through the possible outcomes. You live in the home forever, you sell the home, you move, but rent out the home. Are you going to be, are you making a selection that you are happy with, no matter which of those scenarios it ends up being. So if you know for sure that one of them’s out, that’s okay, but are the other couple of possibilities like you’re set up to do that. Because obviously, like you said, there are some properties that would not make a good rental property that you would pretty much have to either stay in forever or sell, and that does of course limit your options. So it sounds like you were thinking through all those possibilities.

Ethan (24:42): Yeah, the versatility to us was a really big deal. We wanted something that if it is an investment, it’s gonna have the widest exposure to helping us in the future as possible. Especially in the shifting landscape of being an academic, you know, you could apply for something and get it in in New York. What does that look like with your house and what equity did you have time to build? Which is also why before the program it felt like a big deal to us to just simply attempt to buy a home.

Homeownership Considerations and Advice for Grad Students

Emily (25:07): Yeah, absolutely. I mean if your finances are ready like yours were, you know, you had repaid the debt, you had some savings you had on paper, your offer letters and so forth like that is ready. Of course, not everybody, even if they wanna buy a home during graduate school, would be ready to do so right at the beginning. But I agree, like as soon as you are able to, the more time you give yourself, the better. As you’ve been entering into your graduate program and meeting other people, have you met any other homeowners in your graduate program or in other programs at Villanova?

Ethan (25:35): There are a couple, you know, graduate programs, there’s, there is a nice mess of people from different stages in life. Um, there are a few, yeah, there’s a few my, I would say in my generation to keep that as <laugh> as uh, classy as possible. But there are not a lot. And I think a lot of the times when I’ve talked to people about buying a house, they’ve, the question isn’t necessarily how did you do it? It’s how did you start? Because I think people feel really intimidated by the idea of doing so, and it’s not that they have a lack of capacity to do so, it’s just, oh, you know, it is a really overbearing process and having someone else who has done it can just feel like a good encouragement to them. So not a lot of people, but definitely people that are interested in doing so.

Emily (26:27): Hmm. Well I’m glad you’re, you know, available as a resource of course to your peers to give them your tips and what you learned through the process. And I’m glad that you’re, you know, you came on this podcast to, um, cast a wider net of like, hey, maybe it’s possible for you, like it, it is a project, but it’s not, not like too onerous. It just depends on whether you’re financially and emotionally kind of ready for that, which definitely sounds like you were. So maybe to add on to the discussion we’ve already had, but are there any, like, what are the circumstances under which other PhD students or doctoral students should consider home ownership?

Ethan (27:00): This is really basic, but one of the first instances is look at the institution that you’re at. I know that Villanova has a couple economic fail safes for its students that if something really negative were to happen, let’s say your car breaks down, your expensive MacBook breaks, right? And you were planning to buy a house that can take a real hit into your dreams of owning a house. Villanova at my institution has resources where they will cover that for it’s graduate and PhD students. So if you’re an at an institution that has these things to back you up one that’s really helpful. Two, I would say it’s exactly what you said, make sure you’re emotionally ready for it because looking for a house alone can be an emotional rollercoaster. It’s a wonderful coaster that you get off at the end and it’s awesome, but during it it’s a little frightening. And then third, I would say, if you feel that you can keep up with your debt, that’s the biggest thing. If you can continue to make payments, if it’s dwindling, if you feel comfortable with the payment, what, what kind of payment you’d be comfortable with. Those would be the big three things. Your institution, your emotions. Are you ready to buy a house? Is that something you want? Is that what the people around you want? And then third, what is your capacity to have a down payment? And also what’s your monthly gonna look like?

Emily (28:15): And I would say to that third question, um, if you really are considering home ownership, you can reach out to a lender. Like you can reach out to Sam for example, and just be like, this is the financial picture at the moment. Uh, yes, am I ready to buy in what price range, what I qualify for? And a lender of course will give you that information, but they might also say to you, Hey, your, your application’s gonna look a lot stronger if you clear, you know, your credit card debt. There may be some things they can suggest you of like maybe work on this first. Um, student loans, I know you paid yours back. Student loans are less of a heavy weighted consideration. Especially if they’re currently in deferment. So I would say if your only debt is student loans, like go for it, get what the picture is. But like that may not hold you back as much as an equivalent amount of another type of debt. I guess I’ll put it that way. Um, like if you had a car loan or you know, some other things going on like that. So like yeah, it’s never too early to just say, what would I qualify for right now? Okay, if I cleared my credit card debt, if I did this, then what would I qualify for? And maybe come back in a year, whatever, when you’ve had a chance to work on those items within your financial profile.

Ethan (29:27): Yeah, that’s a great point and thanks for the clarification. I think with that, I would say reach out to multiple lenders. One of the first lenders I reached out to said, Hey, you’re not gonna be able to buy a house in the central PA area for at least two years. And I, it was very defeating and very strange and I just felt the need to maybe get a second opinion. So I would say reach out to maybe if you don’t find an answer completely satisfactory and you wanna double check where you stand with a certain lender, reach out to a different one, see what they say and if you get similar feedback, go from there.

Emily (30:00): Yeah. I would say especially if those early answers are, um, limiting or like telling you you can’t reach your goal, like keep asking. Because frankly some PhD students will receive the answer of we don’t lend to people with your type of income or with, or we don’t lend to students or, you know, kind of what you were hearing. Oh, well if you were a medical student it would be different. But in this scenario we don’t do. So you may hear some of those answers. So like you said, always get, I would say minimum three, talk to at least three different lenders, get three different quotes. Um, let Sam be one of them because he does have a specialty in this area if you are a grad student or a postdoc, that kind of thing. But uh, still, you know, there is always a possibility that in your local area, maybe you will find a lender that deals with students or deals with postdocs all the time and like they have that checklist like Sam did, like they may be more familiar. It just very much, you know, could be dependent on your individual housing market.

Ethan (30:48): Yeah, yeah, absolutely. And Sam, again, just to speak to Sam, Sam was wonderful and not only that, but Sam immediately took the pressure off me to try to validate my situation and he could speak the language and immediately asked, Hey, I know you’re gonna have a statement from your acceptance letter of how much you’re gonna make each year. Can you send that to me? And in my head I was thinking, well how does he know that? Like he, he just read, read my mind. That’s wonderful. So having someone with that expertise is really helpful.

Emily (31:16): At least, yeah. One area of the buying process that doesn’t have to be like, quite so onerous. Like, like working with an experienced real estate agent who loves working the first time home buyers, like that’s another real huge like asset in your corner if you can find someone like that.

Ethan (31:30): Yeah. Finding a good real estate agent, they are worth their weight in gold. And I think you hit the nail on the head. There is a lot I didn’t realize, some real estate agents do not enjoy working with first time home buyers and that is more of a burden to them because first time home buyers are going to look at more houses and investigate different things and not know what they want. So that, I think that’s a great point.

Emily (31:49): Well, Ethan, is there anything else that you’d like to add about this whole journey, um, before we ask our final question?

Ethan (31:57): Yeah, I would just a I just wanna echo something you said earlier, which I think was really sound advice, which is just keep asking if, even if you don’t feel like you’re prepared to buy a house, but you have that desire to reach out to a lender, ask them what your situation is, that that’s very similar to what we did. Yes, we didn’t have a lot of debt, but we also did not have a lot of income during the summer and I wasn’t working, I hadn’t worked for a while. Um, my wife and I had never worked two jobs at the same time until this fall when we bought the house. So at that time we were on one income and it was not, uh, an exuberant amount of money, but it was still possible. So I would just offer an encouragement ask and you don’t know what doors could open or close

Emily (32:38): And just, we sort of touched on this, but like you can go to a lender with your offer letter, like you don’t have to wait for your first paycheck to arrive. Um, I’m trying to remember, I know Sam and I have talked to this before. It’s either two months or three months in advance of your start date. You are, you could get a loan based off of your offer letter, so it’s not too early if it’s, you know, the summer before you’re gonna start, you know, a PhD program in the fall. Like if you have that offer letter in hand, you can start those conversations for sure.

Ethan (33:03): Yeah, that’s a great point.

Best Financial Advice for Another Early-Career PhD

Emily (33:05): Okay, Ethan, I, we will wrap up with the final question that I ask of all my guests, which is, what is your best financial advice for another early career PhD? And it could be something that we’ve touched on in the interview already, or it could be something completely new.

Ethan (33:18): I would say reach out to your schools for as many financial opportunities as possible. One of the reasons that I had this opportunity was I bugged my school to see whatever funding I could receive at any moment. And I think as much as we wanna focus on buying the house, there are opportunities at the university you’re at where there are dollars that are waiting to be used no matter what field, what department there are opportunities. And I think having that just a season where maybe you get a scholarship you don’t, you didn’t know was coming, can really, really help your chances to get a house and make you feel more confident in going through that process. So I would say reach out to your institutions about funding, funding that may be available to help you in any way, shape or form, whether it’s health insurance subsidy, whether it’s, uh, a reimbursement for classes or textbooks. Use those tools to your advantage and while you’re looking to buy a house,

Emily (34:08): Love that advice. And I know I, I’ve, I talk with a lot of administrators and it really is the case that there is funding available that sometimes goes unallocated just because they didn’t know where to direct it to. So like ask your advisor, ask your director of graduate studies, anybody on your committee, just like all the appropriate people within your orbit, is there something I could be applying for? Is there money available? Like what do you think I’m a good candidate for? Um, especially if you are anything below fully, fully funded as a graduate student. I mean even if you are, you can still ask, but if you’re below fully funded, then for sure have those conversations. Then they, they should be expecting them frankly because if you’re not fully funded, then they should be expecting that you’re looking around for more opportunities. <laugh>.

Ethan (34:51): Yeah, absolutely. They, especially if you’re not fully funded, there’s a honor system there where they should be bringing you funding opportunities, I would think.

Emily (34:59): Yes. Okay. Well Ethan, thank you so much for joining me on the podcast today and congratulations on your home purchase.

Ethan (35:06): Thank you so much. I appreciate all you do for people who are in precarious academic situations looking for houses. We really appreciate your encouragement and the wealth of knowledge you bring. So thank you.

Emily (35:14): Awesome. Thanks

Outro

Emily (35:26): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

How This DDS/PhD Student Purchased a Condo in San Francisco

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In this episode, Emily interviews Hannah Takasuka, a 3rd-year PhD/DDS student at the University of California, San Francisco. Hannah is in the process of purchasing a condo in San Francisco as part of a governmental program to provide affordable housing. Hannah overcame multiple hurdles in the journey to home ownership, including being rejected by mortgage lenders over her fellowship income. Several puzzle pieces have to come together for any graduate student to purchase a home, and Hannah shares all the numbers and details for how it happened for her.

Links mentioned in the Episode

How This DDS/PhD Student Purchased a Condo in San Francisco

Teaser

Hannah (00:00): I’m thankful being a PhD student has taught me to normalize, “Oh shoot, I’m in trouble. Let’s ask for help.”

Introduction

Emily (00:19): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:49): This is Season 20, Episode 9, and today my guest is Hannah Takasuka, a 3rd-year PhD/DDS student at the University of California, San Francisco. Hannah is in the process of purchasing a condo in San Francisco as part of a governmental program to provide affordable housing. Hannah overcame multiple hurdles in the journey to home ownership, including being rejected by mortgage lenders over her fellowship income. Several puzzle pieces have to come together for any graduate student to purchase a home, and Hannah shares all the numbers and details for how it happened for her.

Emily (01:22): Because we in academia and research are experiencing such precarity in our finances and careers at the moment, I’m doing as much as I can on the financial education side to help you. I’m calling this initiative Giveaway Spring. I’m giving away 60-minute group Q&A calls, 30-minute individual coaching sessions, books, and digital resources—all completely for free—and I’m also sharing the best free financial and career resources I come across for PhDs. Register for my mailing list at PFforPhDs.com/giveaway/ to receive all the details of the current giveaways and an update every other week. By the way, this is the last episode of Season 20 of this podcast. We’ll be back with Season 21 on June 2, 2025. You can find the show notes for this episode at PFforPhDs.com/s20e9/. Without further ado, here’s my interview with Hannah Takasuka.

Will You Please Introduce Yourself Further?

Emily (02:36): I am delighted to have on the podcast today, Hannah Takasuka, who is a third year graduate student at the University of California San Francisco. And I’m really especially delighted to have Hannah on because she actually helped bring me out to campus for a workshop earlier in 2025, and that was a great experience. So here we are recording in March, 2025, and Hannah is actually under contract for her first home in San Francisco. And that is shocking. And so we’re gonna find out in the course of this interview, um, how exactly that happened. So Hannah, welcome to the podcast. I’m so glad to have you on. Um, and will you please introduce yourself a little bit further?

Hannah (03:13): Yes. Um, it’s great to talk with you, Emily. Uh, my name is Hannah. I am a third year DDS PhD student. Um, so after getting my PhD I’ll go to dental school and it’s a similar funding mechanism to the MD PhDs,

Emily (03:27): Emily here breaking in during the editing process. Following our interview recording, Hannah sent me some additional audio contextualizing our conversation and I thought it would fit well here.

Hannah (03:38): Hi, Emily and listeners of her channel. Something that I wanted to express in the podcast but I didn’t have a chance to, was a sense of humility. I do wanna give the disclaimer that, um, being able to buy a home as a third year PhD student is a huge privilege that not everyone has. Um, and people might make certain assumptions about a third year PhD home buyer, um, that like I’m someone who has everything together with my finances, um, and I wanna put down others. Um, or just that there’s this Instagram idea that you see, um, people who seem to be doing everything right in the world and you compare yourself and you think, oh, because I’m not there, I’m not sufficient enough. Um, and so as a point of humility. I still have a lot to improve in my personal finances as well, even with the basics. So at Emily’s budgeting workshop that she hosted at my university, I learned how important it is not to only forecast, um, what your budget should be, but to actually have an automatic tracking system to see how you spent your money compares to what you had projected. Um, and so that’s something that I’m still working on implementing. Um, I’m, I’m part of the way there, but not, not fully there. Um, and so again, I just want to encourage you all to make the steps that make the best sense for you. Um, and home buying in San Francisco is not going to be, is not gonna probably make sense to most, um, PhD students, but I hope that I demonstrated, um, that it is a possibility, um, for some and that it might make sense for you.

Emily (05:41): Alright, back to the interview. Now, did you move to San Francisco when you started graduate school and and what year was that?

Hannah (05:48): I did, uh, that was July, 2022.

Considering Home Ownership as Graduate Student in a High Cost of Living Area

Emily (05:51): And when you moved to San Francisco or, you know, sometime after that, obviously you started considering home ownership, which honestly is something that I would completely write off for a graduate student in San Francisco. And honestly, a lot of even professionals in San Francisco don’t own their own homes. They don’t necessarily see the math as making sense for that. So I’m just really curious about, um, why you even started considering purchasing a home.

Hannah (06:17): Mm-hmm <affirmative>. So I know I wanna be here long term. Um, at least for the next 10 years. Being a DDS PhD student means that I’m here for eight years and I’m, high cost of living cities come with pros and cons. Uh, one of the great pros though is that there’s great career opportunities. Um, and for me, I’m also blessed that I have a lot of family nearby. And so for me it just makes sense to be staying here long term and looking at market rate places. Uh, you’d be correct, Emily. The math doesn’t make sense most of the time. Um, I was going for a walk one day in my neighborhood and I saw this huge sign that said, um, middle income housing available, um, condos are $260 to $500,000. Um, and so decided to call my dad and say, Hey, I saw this sign, like 260,000 is probably way too much. ’cause I had no idea what that number meant at the time. Just sounds like a big number. Um, but my dad says, oh no, Hannah, like, you need to look into that. I’m like, okay, no, no uncertainty there that I need to look more into it. So, um, decided to look more into it and, uh, thankful that it worked out.

Emily (07:34): What does this mean? What is this middle income housing? Is the housing different than other housing or is it just that the loans are structured differently? Or what is this?

Hannah (07:45): Mm-hmm <affirmative>. It could be a combination of both. San Francisco has their permitting for housing, such that 10% of any new construction needs to be designated as below market rate housing, and then you need to fall under a certain income bracket in order to qualify for that. Um, below market rate housing, um, there is also a fee, uh, that new construction can opt out of, uh, building that 10%, uh, below market rate housing. And that fee will go towards, um, affordable housing projects. And so in my case, my entire building is, um, below market rate and run by the city.

Emily (08:26): Wow. What an incredible opportunity. Had you known anyone else who, who purchased a home as a PhD student? Like with the same sort of program?

Hannah (08:37): I do not, no.

Housing Costs and the Home Buying Process in San Francisco

Emily (08:38): Okay. So it was really just you saw a sign and you had to look it further. Amazing. Um, and also just really good on you that and your father too, for pointing you in that direction of like, oh no, like, let’s, let’s go ahead and start, you know, down this road and start investigating this. Maybe we should talk a little bit about the, the sale price of the, of the home that you’re now under contract for. Um, just so we can get an idea of like your income, how that compares to your new mortgage, and also how that would compare to maybe where you were renting before or other similar place that you might rent. Can you just give us a sense of what’s going on with these numbers? Numbers?

Hannah (09:14): Mm-hmm <affirmative>. Um, yeah, so my purchase price is gonna be 260,000, um, and my graduate student stipend is four, uh, $4,200. Um, not including the health insurance, um, but we do need to take taxes out of that. Um, and currently I rent at UCSF housing for $1,350 per month.

Emily (09:41): And your UCSF housing, um, do you have like a studio one bedroom place or do you have a roommate?

Hannah (09:47): Uh, I have a roommate and it’s a two bedroom.

Emily (09:50): Okay. And is that, would you say that that is a subsidized cost or that that’s pretty standard for what you’re getting?

Hannah (09:56): It’s a subsidized cost for sure.

Emily (09:59): Okay, interesting. So you have making the, you’ve made the decision then to move out of subsidized housing into your own owned place. Amazing. And can you tell us, is there anything else you wanna add about this, you know, this opportunity, this program that you’re participating in? Obviously what I’ve heard so far is that these builders have to make the housing available to you. Um, but is there any like special, um, way that you have to, uh, you know, submit bids on the house? Or is it just kind of like regular now that it’s made available? The, in terms of the buying process,

Hannah (10:36): There’s limitations to it. Um, and then there’s also a lottery process, um, both of which are a bit exhausting to think through, um, but can be worthwhile depending on your situation. And I’m thankful that, yeah, I worked through the different, um, thought about the different limitations. Um, so in terms of the lottery system, there were 115 units available in my building. There ended up being 400 people who applied. However, at the workshop they were letting us know that for previous below market rate buildings, um, they’ve gotten to the end of their applicant list because people would decline by the time that the offers came through. For me, I ended up, uh, being fortunate in looking into the different lottery preferences. Um, so if you’re a veteran or um, if you’ve been displaced by a fire, those are a couple of the lottery preferences. The last one is live or work in San Francisco before it goes to general population. Um, and so that’s where most of the people fall. Um, for me, because my family actually came to San Francisco in, um, the early 19 hundreds, um, my great grandmother qualified me, uh, to be considered a descendant of, uh, someone who was affected by unjustified San Francisco gentrification. And that put me in the top bracket such that I had first choice for the units that were 260,000, um, for a one person, uh, one bedroom, um, condo.

Emily (12:18): Amazing. Yeah. You clearly did a bit of legwork on this and it sounds like also you mentioned a workshop, so they’re also kind of offering a lot of information about how this process works kind of upfront, is that right?

Hannah (12:29): Mm-hmm. Yes. Yes.

Emily (12:30): And you mentioned an income limitation also. Do you recall what that was? Obviously you were under it, but you, do you know what the ceiling was?

Hannah (12:37): Mm-hmm <affirmative>. Um, it’s 80% of the area median income, uh, which I believe is about $84,000.

Explaining Graduate Student Income to Mortgage Lenders

Emily (12:43): Yeah, you’re well under that. Super fascinating. Thank you very much. This of course, will be left up as an exercise for the listener, whether their own city has anything, you know, similar in terms of affordable housing being, you know, built and all of that. So that’s awesome that you’ve brought this like to our attention. Okay. But as a graduate student, you may have income, the type of income may be unfamiliar to the lenders who were involved in this. So can you tell us that story?

Hannah (13:12): Sure. Yeah. So there’s, um, a list of maybe 20 lenders that are approved through the city. Um, and you have to pick from that list of 20 for these programs. And so I just reached out to three of them, um, sent them my income and, uh, filled out the application in which you say your employer and how much income that is. And then the next step is that they request your W2. And so I uploaded my 1098T and immediately everyone, all of those three people were confused, like, what is this? I think they’re assuming that I could be an undergraduate student with just a lot of scholarships. And so I was trying to send them a letter saying, Hey, I’m actually union protected, um, I have health insurance year round, here’s a letter from my PI. And just each lender has their different guidelines and knowledge of whether, and also whether they’re willing to look into those guidelines is kind of, um, the vibe that I was receiving. Um, and so I reached out to, uh, your brother Sam to ask how to get help with this because I didn’t seem like I could resolve it on my own.

Emily (14:29): Yeah. So for the listeners, my brother Sam Hogan is a mortgage originator. And because of our relationship, because I had told him years ago how many issues people in our community like Hannah are running into having fellowship income not documented in a way these, you know, lenders expect. Um, he started looking into it now he like specializes in this area. So plug for Sam if you have any, you know, um, questions about getting a mortgage as a first time home buyer especially, and especially, especially if you’re on fellowship, um, please reach out to him. We often do live, um, ask me anything. So if there’s one coming up, you can go to pfforphds.com/mortgage and see if there’s one coming up that you can join and chat with him. Um, but kind of like back to the story. So what happened <laugh>? Like, did you ask him questions? He gave you information to help work with the lenders? Or how did this end up resolving itself?

Hannah (15:20): I was able to learn from Sam and his videos, the language to use towards the other lenders. And so I was just very upfront in the first email saying, hi, I’m Hannah I’m a graduate student researcher. I have a 1098T I don’t have significant W2 income. Um, I know that under Fannie Mae guidelines I need to show three years continuance. And so here’s a letter that I have supporting that, which was great to know in comparison to the exhausting process of filling out the entire mortgage application and then hearing later as if it was a surprise to them.

Emily (15:58): Yeah, absolutely. And that has been, unfortunately the experience of numerous, numerous graduate students and postdocs who have this unusual income type is like, you know, the, the lenders, they look at your number, they look at your annual salary or whatever, and they’re like, oh yeah, we’re good to go. And then once it gets to the documentation stage. That’s where they pull back. And like you said, it can take quite a bit of legwork even just to get all the information over to them. So that can be really disappointing when that happens. And for other people, I know sometimes they’re under contract by that point and it’s like they’ve got a ticking clock kind of timeline that they’re working on and their lender has just said, no, we can’t work with you. Right. So that’s, that’s what ends up, um, Sam, it’s called rescuing mortgages. That’s what Sam ends up doing for a lot of PhDs is he kind of comes in like late in the process because the other lender has just figured out they’re not gonna be able to actually follow through <laugh> the way that they thought. So that can be really scary. Um, I’m glad that it sounds like you weren’t under that kind of time pressure, but you know, in searching for a lender, it, it took, um, a bit of legwork on your part. Okay. Is there anything else that you need to add to the lender aspect of the story or regarding your income?

Hannah (17:02): It took a lot of work, but I’m thankful that I did it. Um, so I, you know, I reached out to the city saying, Hey, I’ve reached out to 11 lenders on your list and they’ve all said no or ghosted me. Um, and I don’t want to, I don’t know what to do. This is the same time I was reaching out to Sam. Um, I think that I’m thankful being a PhD student has taught me to normalize, oh shoot, I’m in trouble. Let’s ask for help. Um, and I think that I’ll be able to achieve great things, um, with the help of others.

Saving for a Down Payment as a Graduate Student

Emily (17:37): Absolutely. What a great observation and attitude to have about this process. And of course you didn’t wanna let this opportunity slip you by, right? Like, this is an amazing, especially as you said, because you plan on living in San Francisco long term, what an incredible, um, time to be able to purchase. Um, I wanna hear a little bit more about the purchase details, if you don’t mind, because a lot of things have to come together for a graduate student to be able to purchase a home. So your income we’ve already discussed and how this program is particularly helping you, but you also have to consider like your debt load. Um, and you also have to consider like your credit score and down payment, although all those kinds of things. Would you be able to provide any details about how it worked in your situation?

Hannah (18:21): Sure. Um, so I’m super fortunate with a combination of, um, my family situation and my own actions that I came out of college without any debt, um, and saved about 15,000 with my first couple of years of just working. Um, and then my last year of college I had an engineering industry internship and so I was able to save about $30,000 with that by, um, living with family and not having significant housing costs. Um, yeah, and so then with a couple of years of my PhD, um, and investing with the past couple of years, uh, was able to save a hundred thousand dollars to put down for my down payment. Um, so there, there were a lot of puzzle pieces that had to come together as you mentioned. Um, and there’s a small time window in which it would work out in the sense that I need to be able to save enough to put down a decent down payment, um, to be able to afford a mortgage within the certain loan to debt ratios that the mortgage lenders require. Um, but then my income needs to be low enough and I still need to have three years of continuance <laugh>. So I don’t know if it would’ve worked if I tried a year later ’cause I don’t know if I would’ve had the three years continuance.

Emily (19:53): Right. Well that’s incredible. What an amazing accomplishment to be able to save up that much, especially starting as a college student, um, and also, you know, to invest it and so forth. Like so glad that worked out for you. Was there like a minimum down payment required or like why did you choose that number to put down? I guess did it have to be that high to make the mortgage numbers work on your income or what, what was the choice behind that?

Hannah (20:19): I learned that our health insurance part of our income isn’t considered income to the mortgage lender. And so it’s about the maximum that I can take with the mortgage and being within the debt loan ratio, which I think is about 30%. Yeah. Yeah. So that, that was the number I, I could put more of a down payment if I wanted to. Um, but I couldn’t put down too much less, um, with the HOA being $400 and then, uh, which is low for San Francisco, HOAs and San Francisco are usually about a thousand dollars. And a lot of times that’s what makes, uh, the below market rate condos that are in 90% that it’s market rate not worthwhile. Um, because for a graduate student having an HOA of a thousand dollars, that’s just like practically our whole rent.

Emily (21:10): Okay. So it sounds like, and this is something I’ve heard from Sam as well, that like, as you said, it’s a, it’s like a needle you have to thread <laugh>, like, um, you need the maximum loan it sounds like, that you could take out on your income with the interest rates available at the moment was about $160,000. That was how much they were willing to extend you. And so you needed to come up with that other a hundred thousand, um, to get to the purchase price does. Is that correct? Yeah. And that’s something that I do hear from Sam quite a bit. Like, yes, I can create a mortgage on this type of income, but the income is obviously low and especially in other areas of the country, it’s gonna be significantly lower than yours. Um, you know, there’s only so many multiples of that <laugh> you can get to until you have to get to like the housing price. And then a larger down payment can sometimes help help in this, but where does that down payment come from? In your case, you did the savings early on and obviously you’ve been very diligent to build that up. Other people, they might ask for gifts from family members to make up the difference, something like that. So there’s, you know, someone has to have the resources, but there’s a couple ways to kind of solve it. Um, incredible, incredible.

Commercial

Emily (22:20): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats. This is a perfect time to book me for a workshop at the end of the current fiscal year or at the beginning of the upcoming academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Similarities Between Buying a Home and Pursuing a PhD

Emily (23:45): By the way, I, I forgot to ask you earlier, but when did you start this process? Like when did you walk by the sign <laugh> and see, you know, $260,000 for a condo?

Hannah (23:54): Uh, what was it, a month before the deadline, which I think was like May 5th. So probably around early April.

Emily (24:01): Okay. So we’re coming up on a year that you’ve been in this process. Wow. Okay. But clearly getting like such a discount. Hopefully it’s, it’s been worth all this all this investment of time. Amazing. Um, were there any surprises that came up in the course in this whole process of, of pursuing this purchase? 

Hannah (24:20): Uh, so it’s kind of like pursuing a PhD in my opinion, in the sense that there are gonna be challenges and you have to decide, um, if you’re gonna try to overcome them yourself by talking directly with the mortgage lender, talking directly with the city who represents the seller in this case. Um, or if you’re gonna go and ask for outside help, like from Sam for example. Um, so in my case, um, deciding to look into the lottery preferences, um, I thought that was gonna go nowhere. I just submitted my dad’s birth certificate and then I get a call from the city saying, oh, your dad doesn’t qualify, but because he’s in the neighborhood that generally does qualify, you know, there are other family names that you can run. And so, um, gave them my grandmother’s maiden name, which is how I discovered that my great-grandmother would qualify me. Um, and with a new construction place, there are a lot of government permits that need to go on. Um, that’s been exhausting in the sense that they first pitched that the first move in dates were gonna be fall 2024, uh, and I wasn’t under contract until winter. Um, and I think there’s just so much uncertainty that they don’t wanna pitch certain timelines to you ’cause they know they’re probably gonna let you down. Um, so originally they said that the close of escrow would be, um, mid-March. Um, and then due to LA fires there was, um, a delay with I think the Fannie Mae permit. Uh, so then they said it was gonna be another six weeks. Um, so all this is to say that the move in date is pretty uncertain. It’s difficult to challenge, uh, it’s difficult to balance that with the moving interest rates, even with the 30 day loan lock that they require you to do. Um, and managing that with your current lease because you wanna give your landlord the notice that they require without you being penalized heavily. Um, yeah. ’cause then they could just, if they delay it again, then I’m without housing or I need to find short-term housing.

Emily (26:53): So at this point, do you have a move out date scheduled with UCSF housing?

Hannah (26:59): I decided to take the risk, um, and set my move out date to be a month after, um, April 18th. Um, because if I didn’t schedule a move out date, then I would be charged likely until July 1st. Um, ’cause that’s generally when the, that’s their default contract end date. Um, and so I’ll need to look for a short term sublet if um, the housing doesn’t end up working out, which is yeah a risk that I’m taking.

Emily (27:34): Yeah, like you said, this is, uh, a common thing with new construction, um, that these kinds of timeline issues can come up, but yeah, it sounds like you’re working with the information you have as best as you can. Um, any other surprises you’d like to share?

Hannah (27:49): Insurance is difficult to buy in California. Um, so that was another challenge. I’m thankful that, um, AAA was still taking people, at least with the agent that I had called, ’cause apparently there were some others in my building that AAA was not writing new policies for. Um, and there are very few who are willing to insure in California.

Emily (28:15): So you said earlier that your long-term plan is to live in San Francisco. Um, how long do you think you’ll stay in this particular condo?

Hannah (28:25): I would love to stay 20 years, but it’s a good question. Will, will my life priorities change in 10 to 20 years from now? Maybe. Um, but I am thankful that my neighborhood is being zoned as a biotech hub. And so even if I do wanna leave the university, there should be great, um, job opportunities within walking distance. Um, and for me being in California and close to family, um, and being in a neighborhood that is walkable, um, instead of owning a car, um, or being reliant on a car is important to me. And, um, San Francisco is the only place that, uh, meets all those criteria.

Emily (29:09): That sounds wonderful. And certainly because of your, you know, dual degree program, you’re gonna be at UCSF presumably for, I think you said eight years total, is that right? So like five more years. Um, awesome. And let’s say if there is ever a time that you do decide you want to no longer live in this condo, are you permitted to sell it? Does it have to be to another qualifying resident or are you permitted to let, to rent it out? Like what are your options?

Hannah (29:37): Um, yeah, so that’s one of the limitations. Um, affordable housing is created, uh, so that it can be affordable for you to live there. Um, not so that apparently there was someone who found a loophole, um, that if you could just rent it out at market rate, you can make a profit off of the city program that is being funded by bonds. And so that’s just not right. Um, so they’ve made the rule that generally you can’t rent it out. Um, but there is, there are certain exceptions, um, like if you get a job offer that’s a decent distance away, um, I’m not sure if they have there, there must be a control under what you can set the rent to being so that it’s an affordable rate to someone else. Um, and then when I sell, if I were to sell the place, um, I need to sell it at the 260,000, uh, plus any documented improvements that I have made to the place, um, I don’t think that I make interest unfortunately. Um, and it needs to be to someone who is below 80% of the area meeting income.

Emily (30:53): So this home is not going to appreciate,

Hannah (30:57): Correct.

Emily (30:58): It’ll be sold at the same price plus improvements. Interesting. And do you mind sharing what your mortgage payment is going to be? Especially how that compares to like what you were paying, what you’re paying currently in UCSF housing?

Hannah (31:11): My mortgage payment is gonna be $950. Um, combined with HOA property tax utilities, I am expecting to pay 1800 a month.

Emily (31:23): So somewhat higher than your current rent. But you get to live on your own.  Um, and you get that stability. Yeah. So this really seems like the impression I’m getting from our conversation is this, for you is a play to be able to stay in the city in a neighborhood you like in a place that’s, that works for you. Um, and just to have that assurance that you’re an owner and you get to be there long term. Is that right?

Hannah (31:47): Yes. Yes. Uhhuh

Emily (31:49): Very good. Um, and you said when you applied for the podcast that you had kind of a message for other PhD students regarding home ownership. Would you like to express that now?

Hannah (32:00): You know, just like when I was playing soccer, I would say you miss a hundred percent of the goals of you don’t take. Um, so you know, you could shoot a soccer ball to try to be a homeowner, um, and it might be totally off the first time. You might look at a market rate place and say, oh my gosh, the HOA is way too expensive. Um, but you know, you’ve learned something, you’ll shoot the ball better next time. And um, maybe it’ll make it to the goal or maybe it won’t. Um, but, uh, personal finance, um, even outside of home ownership is something that you can take in small steps. Um, and it’s okay that the first steps that you take aren’t gonna get you 90% of the way there. Um, but with endurance, um, uh, you’ll be able to be in a much better position than if you were paralyzed, um, with the idea of starting nowhere.

Emily (33:02): I totally agree. I’m glad that you expanded that beyond home ownership to personal finance in general. ’cause that’s exactly how I feel about it. Like, um, as you said, don’t, don’t be paralyzed. Just start taking the steps that you can take and you’ll be better off for it a year or five years or whatever from now. Um, and especially once your income increases post PhD, um, you’ll have the skills, you’ll have the mindsets, or at least you’ll be in a better spot with respect to the skills and mindsets to be able to manage your money at that time when the stakes are a bit higher. Um, exactly. So yeah, I’m so glad you said that.

Best Financial Advice for Another Early-Career PhD

Emily (33:31): Um, what is your, this is the question I conclude all my interviews with what is your best financial advice for another early career PhD? And it could be something we’ve touched on in the interview already, or it could be something completely new,

Hannah (33:44): Turning unpredictable costs into predictable costs, um, by budgeting a certain amount per month so that you’re able to spend your money in the ways that are valuable to you.

Emily (33:58): Very good, very well put. And you are definitely gonna be putting that to use as a homeowner <laugh>, turning those unpredictable home maintenance and repairs costs into something manageable for your budget. So awesome. Hannah, it’s been lovely to you again and get this story. I’m so excited for you in this new, um, phase of your financial journey and congratulations and thank you so much for coming on the podcast.

Hannah (34:20): Yeah, thank you so much for having me, Emily.

Outro

Emily (34:32): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

Why and How These Grad Students Purchased Homes

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In this episode, Emily presents first-person stories from grad students who bought homes during grad school. The volunteers were simply asked to share their stories of home ownership, whatever they may be. You’ll hear from three volunteers throughout this episode, both on how they purchased their homes but also what’s happened since then, the benefits and the challenges. Perhaps you’ll be inspired to pursue home ownership yourself sooner rather than later. The final person included in this episode is a mortgage originator specializing in early-career PhDs, who summarizes why graduate students and anyone paid by fellowship have a difficult time securing a mortgage and his system for framing them as qualified borrowers.

Links mentioned in the Episode

grad student home ownership

Teaser

00:00 Courtney B: Owning a house is all about the long game. We hope to see large returns on the remodeling and roofing work once we sell, but for now we have to be willing to put a decent amount of cash down for deductibles, emergencies and our new monthly loan payment.

Introduction

00:18 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others.

00:47 Emily: This is Season 15, Episode 2, and today we’re featuring first-person stories from grad students who bought homes during grad school. I simply asked the volunteers to share their stories of home ownership, whatever they may be. You’ll hear from three volunteers throughout this episode, both on how they purchased their homes but also what’s happened since then, the benefits and the challenges. Perhaps you’ll be inspired to pursue home ownership yourself sooner rather than later. The final person included in this episode is a mortgage originator specializing in early-career PhDs, who summarizes why graduate students and anyone paid by fellowship often have a difficult time securing a mortgage and his system for framing them as qualified borrowers.

01:32 Emily: By the way, there is still time to volunteer for one of the compilation episodes coming up later in the summer, specifically the episode on unions and unionization movements. If you have a story to share on that topic from the last few years, please email me at [email protected].

01:52 Emily: This next announcement is specifically for those of you who are applying to PhD programs in the US in the upcoming academic year. If you’re not in that group, please share this information with someone who is! On Friday, July 14, 2023 at 10:00 AM Pacific Time, I’m delivering a free webinar titled “Don’t Accept Admission to a PhD Program without a Sufficient Stipend.” Yes, this is something you need to understand and commit to even before you start applying to PhD programs! The three phases of this webinar are to go over why you need to be sufficiently financially supported in your PhD program and what that means to you; how you can ensure that you will be; and what actions you need to take in the fall during application season, in the spring during admissions season, and in the summer before you matriculate to make this come about. This webinar includes what I wish I had known as a prospective graduate student and the hidden financial curriculum of academia that it’s taken me over a decade to uncover. It’s so vitally important for prospective graduate students to have this information early, which is why I’m giving it away for free! Please help me spread the word! Anyone interested can register for the webinar at PFforPhDs.com/sufficientstipend/.

03:20 Emily: You can find the show notes for this episode at PFforPhDs.com/s15e2/. Without further ado, here’s our compilation episode on home ownership.

Hannah Stroud, PhD Student: College Station, TX

03:37 Hannah S: Hi, my name is Hannah Stroud. I am a final year PhD student at Texas a and m University, uh, which is located in College Station, Texas. College Station, Texas is a city with a extremely low cost of living compared to other areas of this country, uh, which is pretty much the only reason that I am here sharing my home ownership story with you today. , I guess I started my PhD in 2020 and purchased my house in March of 2021, and I had been a grad student before that and had been living in college station since 2014, so I’ve been here a while. Uh, and the low cost of living in this area in general allowed me to save a pretty substantial amount of my stipend just comparatively. So in my master’s, I think I was paying like six 50 in rent, uh, per month, uh, which meant that a decent portion of my stipend could go to fun activities or savings in general.

04:37 Hannah S: Um, how I grew my savings was through a robo-advisor managed, uh, money market account and also ETF investments. Um, and that was really helpful in kind of just turning what I had saved into enough to be able to afford a down payment. Uh, and so when I started the kind of mortgage lending process, um, in the first month of my PhD, so I am a fellowship student, which means my income is not w2 and I’m a NSF GFP fellow, which means that my intimate income is guaranteed for three years. So when I started my mortgage process, uh, that was important to my lender. What I didn’t realize is that when my mortgage rates were locked in, uh, they wanted my three years of employment to be verified from the time of closing. So when I closed six months later, I actually ran into some issues, uh, where my lender wanted some way to guarantee that I would be employed at the same salary that I’m currently making, uh, for three full years, not the two and a half that I could promise based on the time that had elapsed.

05: 43 Hannah S: Um, so I ended up needing to increase my down payment to the full 20% so that I didn’t have to qualify for private mortgage insurance anymore. But ultimately, the main aspect of my home ownership story is truly luck. Uh, I’m very fortunate to live in a very low cost of living city, and the timing of the pandemic honestly played a lot into the house prices being very low and mortgage rates being what they were. So given the current environment, I don’t know that a lot of this advice is incredibly applicable, uh, but advice that does stay the same is the, if you have non W2 income, it is important to learn from your desired lender. What aspects of your income are important to them, and if three years of proof of income will be required from the time of closing, it’s been a fun experience overall.

06:41 Hannah S: Ultimately, owning is significantly more expensive than renting because when things break, I am my own landlord and I get to fix them, and sometimes those expenses are more significant than I would like them to be. Uh, within the first kind of few months of owning my home, uh, both the washer and dryer that came out, the house broke, and so I needed to replace those. Um, and I found out that my non-mobile house had a mobile home shower installed in it, and all the plastic parts were degrading, so I needed to, uh, replace all that with copper piping and plumbers are expensive, and then any electrical issues become your problem, AC issues become your problem. So definitely get the home warranty. Uh, if you can include that in the conditions of closing and ha have it be something that the seller pays for, I would recommend that highly. And then I renewed it for a second year as well, cuz my air conditioning unit was pretty old. Um, and that ended up being the right choice for me just because the, the amount of maintenance that I required on, on that particular utility was, was significant in the second year as well. So yeah, hopefully you have as good of luck on your journey as I’ve had online and yeah, good luck going forward.

H, PhD Student: East Coast

08:00 Emily: This submission is from “H”, a PhD student who lives on the East Coast. Quote. I had a vague plan to buy my place in my second or third year of my program, but it ended up happening in a surprising and rushed way when a house came up right in my neighborhood, I had something like a month to close, which I did in August, 2020 at the beginning of the second year of my program. My income has increased since I got the house, so the monthly payment, including mortgage insurance and property tax, is now a little less than a third of my post-tax income. Initially it was closer to 40%. Having roommates in various configurations has offset between 25% and 65% of my payment at any one time. But there have also been months between roommates where I’ve been covering the whole amount. I’ve had kind of a revolving door of housemates, which has been a lovely part of having my house.

08:49 Emily: So far it’s been friends or friends of friends, almost all grad students because my roommates and I, I have so far always been gone for the summer, I rented out for more like 85% of the mortgage to people doing summer internships. Here it offsets the fact that my July and August stipend payment is lower than my 10 month academic year stipend payment. I charge less than market rent because I’m not a professional landlord and I don’t have a property manager. The house is old and not in perfect shape. When I’ve had water in the basement, a broken water heater or a broken window, people have been understanding and patience since I’m not charging a lot, I’m also able to undercharge because I have a financial safety net. My parents lent me almost all of the deposit and I won’t start paying them back until I finished my program.

09:33 Emily: Their justification was that they had paid the same amount for my siblings law school. We’ll pay them back interest free. I would’ve been able to get a place on my own, but it would’ve been smaller and I would’ve bought later. The fact that I have a financial safety net has made being a homeowner less stressful. I haven’t had to ask my parents for money for repairs so far, but I can sleep at night knowing I’d be able to borrow money from them if I urgently needed a new roof or something. I love having an old house, but because of the upkeep, I think it would be too stressful to own one without that kind of cushion. It was very much a pandemic home purchase. I remember reading all these articles in 2020 and 2021 about people who are desperate for more space when working from home and how they had overpaid for falling apart houses.

10:17 Emily: I was like, oh my God, is that me? Now with the interest rates up, the news is all about people who lucked out with 2% interest rates like me, and now their incentive is just to never sell. Sometimes I think about how my mortgage on the house is twice what I was paying for a one bedroom apartment and how I spent money on repairs and my bills are much higher than in the apartment. And I wonder what would’ve happened if I had plugged the difference into an index fund instead. But if the house has increased in value, as much as Zillow says the house wins out as an investment, obviously you have to take Zillow with a grain of salt. I think only time will tell whether this was a good financial decision or not, regardless of whether it turns out to have been a good investment.

10:55 Emily: I have so many great memories of this house. I love having space to host and being able to provide a gathering place, especially in the pandemic. When I hosted people from out of town who needed a break from being isolated alone in their apartments. I’ve loved becoming closer to my housemates. I’ve had friends stay in the house when their family were visiting from abroad and needed a place to stay. I feel happy that the house has helped people out with somewhere to stay when other solutions were expensive and logistically difficult. I’ve loved being able to host my family, especially at the holidays. A lot of this would just not be possible if I were renting. I know that buying a house is normally seen as tying you down, but for me, I think it’s given me the freedom to be mobile. Having the house has allowed me to be pretty flexible during the latter part of my program, which requires research abroad.

11:40 Emily: I offset the monthly payment by renting it out so I don’t feel like I’m obligated to stay there just because I’m paying for it. When I’ve worked abroad on a job that included housing or got grants that covered my housing while researching, I’ve been able to save a good amount of money, money by reducing my housing expenses, but I also didn’t need to formally move out and I know I can come back whenever because there’s still a spare room compared to having to deal with paying for storage and finding a place during awkward lease gaps. I’m able to be much more of a free agent than other people I know Doing dissertation research abroad, it’s just one of the many ways that being financially secure makes the experience of being a grad student dramatically less stressful. I think it’s important to recognize that my financial privilege and home ownership, along with my citizenship, have given me greater research capacities. I’m not sure what I’ll end up doing with a house after I leave the program. I might rent it out on a more formal basis or if I decide to buy elsewhere, I might sell. End quote.

Courtney Beringer, PhD Student: Corvallis, OR

12:37 Emily: This next submission is from Courtney Beringer, who was previously interviewed on this podcast in season 10, episode 18.

12:45 Courtney B: My name is Courtney and I’m a third year PhD student in civil engineering at Oregon State University in Corvallis, Oregon. Uh, I recorded a podcast with Emily shortly after I bought a house in 21, so I’ll briefly talk about that and dive into what has happened since then. I bought a house with my friend in July, 2021 in Corvallis, Oregon for about $250,000. It’s a three bedroom, two bath with an additional room that we converted into a bedroom. My co borrower and I live in the house along with our two tenants. Our mortgage is about $1,500 a month, and our rental income is, uh, $1,300 a month. Um, we were patient and took months to find a house that met our needs of being within about five miles of campus. Um, had rooms we could rent out and was under our budget of about $320,000. Our loan process was made, uh, a little complicated by having co borrowers who were not related or married.

13:50 Courtney B: And because we were both grad students with changing sources of income throughout the year, we worked with our loan officer through these hurdles and everything actually turned out great. It has now been two years as homeowners and with tenants. Uh, it has been great to have a passive side income through renters. We have enjoyed the freedom that home ownership has provided, uh, but home ownership is always unpredictable. We had a water heater leak in January this year, which caused my co-owner one of our tenants and I to live in a hotel for two months while demo and construction occurred in my room and our shared bathroom insurance covered so much. But this took a lot of time out of our studies and lives to move, make remodeling decisions and coordinate with contractors, and we just got a roof place, which added a $13,000 loan to our joint finances. Owning a house is all about the long game. We hope to see large returns on the remodeling and roofing work once we sell, but for now, we have to be willing to put a decent amount of cash down for deductibles, emergencies, and our new monthly loan payment. Uh, I hope my story gives you a sense of the joys and realities of being a homeowner.

Commercial

15:07 Emily: Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats, and I’m now booking for the 2023-2024 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/speaking/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Anonymous, PhD Student: Atlanta, GA

16:26 Emily: This submission is from an anonymous contributor. When they mentioned Sam in the course of this contribution, they’re referring to Sam Hogan, a mortgage originator specializing in early career PhDs. And we’re actually gonna hear from Sam next

16:39 Emily: Quote. I purchased a home during the spring semester of my first year as a PhD in Atlanta, Georgia. I closed in April, 2023. I have been debating home ownership since 2020. I would be entering graduate school in my early thirties, so I wanted to try and build wealth so that I wouldn’t be too far behind in retirement savings or net worth. When I finished in my late thirties, my parents were not convinced that buying was the right move. So when I moved back home to Atlanta to start school, I ended up renting a beautiful old studio. But in January of spring semester, when I was informed that rent would be going up $200, I realized that I was ready to buy and that I needed it to happen fast.

17:18 Emily: I tried several different mortgage lenders, but most were rather confused by the stipend structure. I would get pre-approved based upon my credit score and lack of debt, but then would always receive several follow-up emails asking for documents from my university, asking for verification and explanations. I turned to Sam fairly early on, just asked him questions and then ended up going back to work with him after the other lenders didn’t work out. I received my pre-approval from Movement Mortgage with no follow-up questions and began house hunting. In late January, maybe eight or nine bids later, I finally landed on a home, not a condo, which had been my original call, but HOAs kept blowing my budget in late March with a closed date in early April. For a moment, there was a bout of panic because the house has an unfinished primary suite and we, Sam, my realtor and myself, didn’t know if it would pass appraisal the suite, huge bedroom, bathroom closet was essentially a bonus room or a garage.

18:11 Emily: The outside structure was finished, but there was nothing else. No drywall, no electric, nothing. Ultimately, the house passed appraisal, the seller contributed to closing and Sam even managed to get me a few hundred dollars back at closing. Looking back, this story sounds really straightforward, but it was super stressful. I also switched realtors during this process and I wish that I had done so earlier. I was also saving between $800 and a thousand dollars a month between January and April to make the down payment, and also ended up basically emptying my investment account and my Roth ira, both of which had less than $2,000 in them. I put 3% down on a home that was less than $200,000 a total steal in Atlanta. All in all, I’m glad that none of the other bids worked out. This home is spacious, has a lovely yard, is in a great location, and the unfinished primary suite will multiply the value of the home.

19:01 Emily: Of course, the house will need a lot of work, but I have a roommate and we’re both excited to get our hands dirty. My biggest piece of advice is to remember that the people who help you purchase your home need to advocate for you. Sam is a phenomenal advocate and helped me get into my first home and stopped at nothing to make the sale work. The realtor who I ended up working with was also an amazing communicator, and I wish that I had been working with him the entire time. Of course, save money and do your research, but remember that the people on your team matter. End quote.

Sam Hogan, Mortgage Originator

19:36 Sam H: Greetings. This is Sam Hogan. I help graduate students, postdocs and PhDs achieve home ownership in all 50 states. We’ve closed hundreds of loans for PhD students and postdocs. They have a unique, uh, income set and require unique mortgage approval process. Um, having done this for over four years now, we are the nation’s only lender that focuses on your success while you’re getting your degrees in higher education. My team is a longstanding advertiser and sponsor of PF for PhDs, and I am delighted to also be Emily’s little brother. So Emily reached out to me in, um, spring 2019, um, having seen a pattern of difficulties for PhD students, um, closing on home loans.

20:29 Sam H: The issue with PhD income is that the loan officer in the pre-approval stage will either pre-approve them and not do enough work themselves or deny them out the gate. Now, when an underwriter sees the PhD income after loan offer, pre, pre-approved them, them, it might not have enough information about the stability and continuance in history, and you also can be issued a denial because the underwriter doesn’t have to give you a final approval based on those offer letters. Um, after some a few months of investigating, we developed a system to properly document the income, the continuance, and the stability. Um, regardless of how soon or how late you are in your PhD stipend continuance, where I come in is demonstrating that the borrower who’s a PhD student has always been a full-time student, has always maintained a good gpa, has a track record of staying in the same field of science or research.

21:34 Sam H: We do have to over document a file sometimes to demonstrate continuance, but even if we have less than three years, we are able to help the underwriters understand the quality of individual behind this stipend income, which has helped us become successful in closing loans in this space. I will rescue PhD deals every single month. This happens often with, uh, new construction builders and their lender is completely unfamiliar. Or some other companies like, um, loan Depot for example, will just outright never accept stipend income. So those clients will read my reviews or, uh, find Emily’s blog where we give a little bit more of in depth information on how it works. Um, I’ll connect with them and they will become homeowners and protect their deposit, have a more stress-free approval working with us versus a lender. Loan officers. Not, not familiar. When we originally started helping PhD students and post-docs become homeowner, homeowners, we were more comfortable with having three years of continuance.

22:42 Sam H: So at the early years or maybe before your first semester of becoming a PhD student, that was our, um, bread and butter easy approvals with confirming that income. As we’ve done more PhDs and expanding to more states, we’ve actually seen some success helping PhDs who are in their later stipend years, years four, five, sometimes six. Um, so really we just need to make sure that we can show history and continuance. Even if you’re stipend might be ending in a few months, we can still help you. We just like to show the career field that you’re going into and some other details about your career path and your future successes. A lot of home buyers in this market are not excited about taking higher than a 5% rate, and I wanted to just encourage people that it is much more difficult to find the home than to get a mortgage on it. So we say in our industry, marry the house date the rate. Once you’ve found your home and rates improve, you’ll be able to refinance and lower your payments and lower your total interest paid. What you don’t want to do is wait for rates to get a little bit lower and then the market is flooded with buyers and you have more competition searching for that same home.

24:03 Sam H: Having to read originated loans for seven years working with the PhD community just makes my life such a breeze. Everyone is very responsive, calm, cool, and collective. They understand what I’m talking about and they’re willing to listen to me explain a little bit extra about the home buy-in process so they can have a better understanding of it. Unfortunately, there’s not a lot of standard education on how to buy a home or how to get a mortgage, but that’s okay because you have people like myself who are willing to take the time to help you understand and find success in this space. But working with the PhD community has been, um, so wonderful over the last four years. I I wouldn’t trade it for anything. Having to having clients who, um, are attentive to your requests. I, I will say well qualified, a good, good credit scores and goal oriented. If you’re committing, uh, five or six years to a new area and you don’t wanna waste five or six years worth of rent, you know, please reach out to myself. The best number to reach me is 540-478-5803. Um, and I’m looking forward to hearing from you. Happy hunting.

25:14 Emily: I host monthly. Ask me anything with Sam. So if you’d like to meet him and ask a question about mortgages or the home buying process, please register for our next one pfforphds.com/mortgage.

Outtro

25:32 Emily: Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

Can I Qualify for a Mortgage with a Short-Term Fellowship or on an F-1 Visa?

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In this episode, Emily shares a few clips from the first-time homebuyer Q&A that she hosted with Sam Hogan on May 6, 2021. Sam is a mortgage originator with Prime Lending (Note: Sam now works at Movement Mortgage) specializing in graduate students and PhDs, an advertiser with Personal Finance for PhDs, and Emily’s brother. The first pair of questions is on whether having three years left on your fellowship offer is required to get a mortgage. The second pair of questions is on qualifying for a mortgage if you’re on an F-1 visa. These questions are among the most common that Sam receives.

Previous Episodes with Sam Hogan

Introduction

Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts.

This is Season 8, Bonus Episode 1, and today I’m sharing a few clips from the first-time homebuyer Q&A that I hosted with Sam Hogan on May 6, 2021. Sam is a mortgage originator with Prime Lending (Note: Sam now works at Movement Mortgage) specializing in graduate students and PhDs, an advertiser with Personal Finance for PhDs, and my brother.

Sam has been on the podcast before in Season 2 Episode 5, Season 5 Episode 17, and Season 8 Episode 4. As Sam has gained experience working with PhD clients over the last few years, he’s been able to get mortgages approved in scenarios that didn’t seem possible a couple of years ago. We’re using this bonus episode to update you all on this evolving situation.

What you will hear next is me reading questions that were submitted over chat during the Q&A call and Sam’s answers. We selected these questions because they are among the most common that Sam receives. The first pair of questions is on whether having three years left on your fellowship offer is required to get a mortgage. The second pair of questions is on qualifying for a mortgage if you’re on an F-1 visa. There were a few dozen people on the call so you will hear some background noise as well.

If you would like to attend a Q&A call of this type, please sign up for the Personal Finance for PhDs mailing list at PFforPhDs.com/mortgage/. I’ll be in touch over email about the next scheduled call. As of now we anticipate holding another one in June 2021 and periodically after that.

If you would like to get in touch with Sam directly regarding your own mortgage, you can call or text him at (540) 478-5803 or email him at [email protected].

Without further ado, here are the clips from the first-time homebuyer Q&A call with Sam Hogan.

Conclusion

Thank you, Sam, for giving your time and expertise to this call and thank you, participants, for your excellent questions! If you, listener, are interested in attending a Q&A call for first-time homebuyers in the near future, please go to PFforPhDs.com/mortgage/ and register for my mailing list. I’ll be in touch over email when we schedule the next call. If you would like to contact Sam directly regarding your own mortgage, you can call or text him at (540) 478-5803 or email him at [email protected].