Homebuying January 05 2017

Determining the Better Fit for You – To Rent or To Buy?

If you’re looking to make a move soon, you may be faced with a common question—to rent or to buy? When determining whether or not to continue to rent or if you’re ready to become a homeowner, there are a number of factors to consider. Below, we’ll walk you through the pros and cons of both to help you better make your decision.  

The Pros and Cons of Renting

You already know the first rule of real estate—location, location, location! If big-city living is a priority for you, it may be worth the cost of renting to be able to live near all of your favorite places. However, unless you live in an area with rent control laws, your landlord will have the ability to raise your rent when it comes time to renew your lease. Homeowners with a fixed-rate mortgage make the same payments each month, regardless of what the market does. Those who are in the early stages of their career may find renting to be the best option until their professional life becomes more stable. When you rent, relocating may be less time-consuming and costly if necessary. If your credit score is a little on the low side, renting may be best while you work towards getting your score improved. While most landlords do require credit checks, it is typically not as high of standards as a mortgage lender.

The Pros and Cons of Buying

You’ll be paying to live somewhere no matter what. But unlike renters, homeowners are building equity with each mortgage payment they make. Every dollar you put towards your loan’s principal balance represents a step closer to actually owning your property. However, building equity isn’t necessarily automatic profit. If home value’s decrease in your area, dragging down your home’s appraised value, you could risk a loss when you go to sell. You can boost your home’s value through certain home improvements. Projects, like paving the driveway or adding a deck, can add extra money in your pocket down the road by adding more curb appeal to your home. And speaking of home improvements, as a homeowner your DIY projects and painted walls answer to no one (provided they don’t violate any HOA rules.) Updating your living environment to suit your style is a fun aspect of owning a home – and generally not available to renters. As a homeowner, you will be responsible for any and all maintenance work around the home. Unlike renting, where you can call your landlord up anytime your stove goes out, you will have to have an emergency fund set up for any unexpected repairs.

So…to rent or to buy?

After weighing all of these factors, it will likely come down to what will make you happy. While renting does have its perks, owning your own property will build a better financial future in the long run. When comparing the two, renting often seems less expensive, especially during the early years of a home purchase—but the path to financial stability is a marathon, not a race. As time passes, you will begin to build equity and increase your net worth with each payment towards your mortgage. Home buying may cost more upfront, but the long-term return on investment may be worth it. However, if you’re looking for a downsize with the appeal of less maintenance, renting may be your best bet.  

Are you ready to be a homeowner?

Speak to a Loan Officer today!

    By Meagan Rochard Sources www.nerdwallet.com www.moneycrashers.com

Search Results for query

November 10 2021

Pet-Friendly Remodeling Ideas

Here are a few ideas for making some pet-friendly changes to our homes to make them more fun, friendly and comfortable for our furry friends.

Read More

November 03 2021

Fall Garden Cleanup Checklist

Find out which chores to skip, which are must-dos, and how to keep your garden looking beautiful in the fall.

Read More

October 27 2021

Should You Buy a Home with Cash?

Paying upfront instead of obtaining financing is often seen as a way of getting a leg up on other potential buyers. But is it always the best idea? And why is it so common

Read More

October 19 2021

5 Ways to Make Your Offer Stand Out in a Tight Housing Market

With huge buyer demand and a shrinking inventory, this market means you'll need to be strategic, creative, and prepared in order to buy your dream house.

Read More

October 12 2021

Should I Buy a Home with an HOA?

In the excitement of buying a new home, it can be easy to overlook the presence of a Homeowners' Association, or HOA. But an HOA can have a lot of influence over your purchase choice, including your monthly payment, the money you need to set aside for...

Read More

October 04 2021

14 Brilliant Ideas for Decorating Your Porch This Fall

Simple and inexpensive solutions for a cozy, colorful porch that says "welcome."

Read More

September 23 2021

7 Surprising Things First-Time Homebuyers Should Never Do, According to Loan Officers

Loan Officers Rachel Alcaraz and Haley Aivazian share their must-follow tips for first-time homebuyers.

Read More

September 08 2021

Expand Your Living Space with the Ultimate Patio

With some creativity, DIY spirit, and a bit of a budget, you can transform your patio into a space not only that you love, but that creates value.

Read More

September 02 2021

Mistakes Sellers Make When Showing Their Home

Here are some do's and don'ts to help show your home in the most appealing light.

Read More

12345Last

Mortgage Calculators

Crunch the Numbers With Our Helpful Mortgage Calculators

Payment Calculator

payment calculator

Payment
Calculator

Affordability Calculator

affordability calculator

Affordability
Calculator

Refinance Calculator

refinance calculator

Refinance
Calculator

The Modern Digital Mortgage with a Personal Touch

Paperless. Effortless. Awesomeness TM

Simplify the home financing process with our Digital Mortgage. We'll be here to help navigate you through the entire process.

Get Pre-qualifiedWhat is a Digital Mortgage?