Purchasing a home is likely the single largest investment you will ever make. Although there are many positive aspects to buying and renting, both also have some drawbacks. By carefully reviewing the advantages and disadvantages of each, you can make a wise decision about your individual situation.
- Ability to easily relocate
- Not responsible for upkeep or maintenance
- Renting may be more affordable on a monthly basis
- Renters are often unable to make aesthetic changes
- Reliance on a landlord
- Renters pay for housing without building equity
- Home prices are currently low
- You have the freedom to decorate and make permanent changes
- There are tax advantages for homeowners
- Responsible for home maintenance
- Long-term commitment
- Costs of obtaining a mortgage and making monthly payments
Even if you think that positives of home buying outweigh the negatives, you must ask yourself if you are financially ready to purchase a home. Here are four questions to consider before deciding to buy:
- Do I have a large enough down payment?
- Am I paying more money to my landlord than I would be for mortgage payments?
- Is my debt load manageable? Not only will a high debt load make it harder to obtain a mortgage, my monthly mortgage payment may prove to be overwhelming when combined with other debt such as student loans and credit card bills.
- Am I willing to live in the same home for at least five years? Due to the costs of buying and moving, homeowners won’t recoup those costs for at least the first five years, longer in a slow housing market.
Due to the emotional and financial commitment involved with purchasing a home, it’s important to weigh the pros and cons of becoming a homeowner. If you’re ready to take on the responsibilities and satisfaction of owning your own home, now may be the perfect time to begin the home buying process. Talk to one of our loan officers today.