When it comes to owning a home there are many advantages and disadvantages that you should consider carefully especially in this current economy.
You should take into consideration both the good and the bad when deciding to either rent or purchase a home and see how they fit your situation.
Let’s take a look at a few things to consider while you are deciding to buy or rent.
The down payment! Many lenders today are doing away with the no money down, 100% financing and are requiring a large down payment like 10% or more. Sure you might find a lender with one but qualifying for that type of loan will be tough.
If putting down 10, 5, or even 3% if tough for you then the best thing right now is to put that money away either in savings or invest it (be careful and seek out good advice before you invest).
Interest Payment on a Mortgage! OK so you might hear that getting a buying a home and getting a mortgage is a tax benefit…they are right in some instances but, not always. Check with the IRS or your local tax dept (if you don’t reside in the US) to find out what the qualifications are.
For us folks here in the US if the mortgage interest and all you other deductions don’t exceed the standard deduction allowance then is it really a benefit?
My Home Is Appreciating in Value…I am building Equity! Really?
With the economy in bad shape and the Real Estate Market going in the toilet – I don’t know too many homeowners who are jumping for joy right now. As a matter of fact most are losing value. Also, you home won’t go up in value if you don’t do…
Home Repairs! The one good thing about renting a home or an apartment is that if something breaks like the toilet all you have to do is call the landlord and they’ll either come fix it themselves or call someone and you don’t have to come out of pocket with the cash! Oh and let’s not forget you will still have to pay…
On Going Insurance and Taxes!
Many people know that when they pay their mortgage they are paying taxes and insurance and in some cases Private Mortgage Insurance and when the mortgage is done you are still paying for Taxes and Homeowners insurance.
Yes, renters should buy insurance but it is less expensive than homeowner’s insurance.
OK renters save money because they don’t have to pay for things like homeowner’s association fees, or property taxes, and Maintenance charges (actually they are in the rent) but, owning a home can give you security, pride freedom to decorate your home without have to worry about breaking the lease.
So, which should you do…
Buy or Rent a home?
It is a tough decision and the only answer I can give is it depends on you and your financial situation. Everybody is different and you should only choose after taking into consideration your financial situation and family needs along with the pros and cons of homeownership and renting.