Was Dave Ramsey Right About Rentals? (Don’t Use Debt)
October 21, 2026
AI Summary
5 min readOn a BiggerPockets Q&A episode, co-hosts Henry Washington and DeAndre McDonald took on a question that cuts to the core of how most people get started in real estate: is Dave Ramsey right that you should only buy rental properties with cash or a 15-year mortgage? The episode’s throughline is a tension between two philosophies—Ramsey’s debt-free absolutism and the investor’s practical need for leverage—and the hosts use listener questions to explore where each approach makes sense, and where it doesn’t. Along the way, they cover tenant screening, turnover delays, capital raising for young investors, and hotel-to-housing conversions, always returning to the same theme: context matters, and one-size-fits-all advice rarely fits the person who actually wants to build a portfolio.
Dave Ramsey for Addicts, Not Investors
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What you'll learn
- 1 (00:00) **Dave Ramsey’s Rental Property Philosophy** - The hosts introduce the central question: can you build a portfolio by buying rentals with cash or using only a 15-year mortgage, as Ramsey recommends?
- 2 (06:21) **Managing Rental Turnover Delays** - The hosts break down what creates the biggest delays during tenant turnovers and how to mitigate them.
- 3 (15:04) **Tenant Offers Full Year of Rent Upfront** - A landlord asks whether to accept a tenant with bad credit and a domestic charge who wants to prepay a year of rent.
- 4 (21:24) **18-Year-Old Wants to Start With No Capital** - Kyle from Dayton asks how to raise capital or whether he should just work and save.
- 5 (30:24) **Hotel-to-Housing Conversions** - A commercial investor asks about converting distressed motels into workforce housing or senior living.
- 6 (40:23) **Working With City Planning** - A closing insight on how to succeed with municipal approvals.
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Guests on this episode
Show Notes
You want to buy a rental property, so you put 20% down and get a mortgage to cover the rest. This is how most investors buy real estate, but some (Dave Ramsey) think you can do it without debt—or at least less of it. Can you actually build a real estate portfolio with cash? Will a shorter note kill your cash flow? Today, we’re putting these two investing philosophies to the test!
We’re answering more questions from the BiggerPockets Forums—this time, with help from Deandra McDonald, the investor who went from $4,000 to financial freedom with rental properties. After a debate on using leverage in real estate, we’ll field questions from a couple of self-managing landlords who are struggling with tenant screening and turnovers. Should you approve a “questionable” tenant if they’re pre-paying the year’s rent? How do you keep contractors on schedule when doing repairs?
If you’re trying to get into real estate investing with very little money, what should you do? We’ll discuss whether it’s better to raise capital from family and friends to invest today or hold off until you’ve saved up your own down payment. Finally, an investor wants to try their hand at hotel conversions. With this being right in Deandra’s wheelhouse, she shares the investing strategies that have (and haven’t) worked for her!
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In This Episode We Cover
Whether Dave Ramsey is right (or wrong) about using leverage in real estate
The easiest (and most difficult) aspects of rental turnovers More from this podcast