Two financial legends, two completely different paths to homeownership. Dave Ramsey urges you to save up and buy a house outright — no mortgage, no monthly burden. Warren Buffett, on the other hand, calls the 30-year fixed mortgage "the best instrument in the world." But who's actually right?
Dave Ramsey: Home Is Better With No Debt
Ramsey has long championed the "no debt" lifestyle — especially when it comes to buying a home. His Ramsey Solutions blog features a guide titled "3 Simple Steps to Pay Cash for Your Home," advising buyers to eliminate all debt, build a sizable emergency fund, and save up enough to pay 100% in cash before purchasing a property.
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Ramsey strongly discourages 30-year mortgages. In Mortgage Loan Do's and Don'ts, he states: "Your home loan should be a conventional, fixed‑rate mortgage with a 15‑year (or less) term. Do not get a 30‑year mortgage!" He notes that a 30-year loan often costs tens of thousands more in interest compared to shorter terms.
When a listener asked if there was ever a case where a 30-year mortgage made more sense than a 15-year, Dave Ramsey didn't hesitate.
"If you can't afford a home on a 15-year mortgage," he said, "it means you can't afford the house. Period."
Warren Buffett: A 30-Year Mortgage Is Strategic
Buffett takes a very different view. During a 2017 CNBC interview, he described the 30-year fixed mortgage as "the best instrument in the world, because if you're wrong and rates go to 2%… you pay it off." He called it "a one‑way renegotiation," explaining that if rates drop, you refinance; if they rise, you're locked in.
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Buffett didn't just praise 30-year mortgages — he used one himself. Back in 1971, he bought a vacation home in Laguna Beach for $150,000. Even though he could've paid cash, he only put down around $30,000 and financed the rest through Great Western Savings & Loan. Why? Because he believed he could get a better return by investing the remaining $120,000 instead of locking it all into the house.
"I thought I could probably do better with the money than have it be an all-equity purchase of the house," he told CNBC.
So that's exactly what he did. With the money he borrowed, Buffett said he bought about 3,000 shares of Berkshire Hathaway stock — a move now worth around $750 million.
How Their Advice Really Differs — And Which One Might Be Right for You
At the core, Ramsey and Buffett are operating from two completely different philosophies — and life experiences. Ramsey built his wealth through real estate and a brand rooted in helping people live completely debt-free. Buffett became one of the richest people on Earth by investing, often using other people's money, and holding for decades. They both succeeded — just by taking opposite approaches.
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So when it comes to mortgages, who's actually right?
Truth is, there's no universal answer. Financial experts often argue the same divide. Some say the psychological freedom of being debt-free is worth more than a potentially higher return elsewhere. Others point out that using cheap debt to invest in higher-yielding assets — especially during low-rate periods — can build wealth faster if done responsibly.
Ultimately, who you choose to follow depends on your own situation.
If you're the type of person who craves stability, doesn't want to worry about interest rates or market fluctuations, and prefers to sleep at night knowing your home is fully yours, Ramsey's advice makes perfect sense. His entire system is built around financial peace and long-term security — especially for people who don't trust themselves to invest wisely or stick to a plan.
But if you're comfortable with risk, disciplined with money, and confident you'll actually invest the difference instead of spending it, Buffett's strategy might offer more upside. The key isn't just borrowing — it's what you do with the borrowed money. Buffett didn't just take out a mortgage — he turned the leftover cash into one of the greatest stock picks of all time.
In the end, both strategies work — but only if they match your behavior.
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