Should I rent or buy? Buying a home is one of the most important decisions you can make. It really gets to the heart of where you are as a single person or as a family. The financial consequences can be enormous, so at Loan Leaders of America, we want you to make the right choice. Say you love your job, but you are also looking for the next best opportunity. You are married and want to start a family, but not sure if you want to put down financial roots in a house. Housing prices per foot vary widely from state to state, but at Loan Leaders of America, we have some ideas to help steer you to the right decision regardless of your location.
Staying Tight or Itching to Leave
If you love where you live, and feel good about your job(s), then you may tilt toward home ownership. But only if you plan to stay put for 3-5 years, as you are unlikely to see enough appreciation in the price of your home to recover up-front costs, like mortgage fees and agent commissions. That’s also assuming home prices are increasing in value, and history tells us that is not always the case.
But I’m a Millennial: What About Me?
A greater number of millennials are putting down roots and getting a mortgage. Those 25-34 years old say they are looking to buy in the next three months. That can be a good strategy, to have your income go to an asset, rather than to a landlord. But it is a big financial decision, so think about a few things.
It is best to rent when:
You don’t have money for a down payment
You don’t have money for the extra costs of upkeep of a home
You’re not sure about your job situation
You have a short term work assignment and may be transferred elsewhere
It is best to own when:
You can cover the added costs of owning a home
You can comfortably make the down payment (typically 20% of the home’s cost)
You can easily cover the closing costs and real estate commission fees
You can cover the maintenance and homeowner’s dues
You are settled in your job and plan to stay in the area
Benefits of Home Ownership
So say you see yourself in the “best to own” category. There are benefits to home ownership. Low interest rates on a 30-year fixed loan can be attractive. It decreases your monthly mortgage, and if you itemize your federal return and don’t qualify for the alternative minimum tax, you can deduct your mortgage interest and property taxes. The biggest benefit is that you are building equity in an asset: your home, rather than paying a landlord every month and that money goes down the financial drain.
At Loan Leaders of America we have a great tool to help you figure out if you are in a position to own versus rent. We call it a Rent vs. Buy Calculator and it can really give you clarity on which way you should go. Using our Calculator tool, figure out how much more you would need each month (above your current rent) for mortgage, insurance, taxes and maintenance. Try setting that amount aside for a few months. Do you miss it? Is it impacting the quality of your life? If the answer to these questions is “no,” then you may be ready to take the plunge into home ownership.
There is also an emotional component to home ownership. Some people just don’t like the added concerns of being responsible for all of the maintenance. But others like the flexibility of owning a property they can change to their liking and tastes, and enjoy the stability of owning a property. At Loan Leaders of America, we want to help you make the right decision for you. Contact us if you are ready to buy, we’ll be there to help you every step of the way!
Extremely helpful and professional throughout the whole home buying process. Danny Schultz was available for anything we needed and treated every request with the urgency and efficiency you look for when dealing with the stressful task of buying a house. I have already recommended Loanleaders of America to my friends and family and will definitely continue too in the future. Thank you so much to Danny and the whole team at Loanleaders for making us feel like we were in good hands throughout every step of the way! If there was an option for more than 5 stars, this team deserves it!Jake M. from Chino, CA
First of all, thank you so much for the wonderful experience you provided during my home refinance. Andrew and Gina provided excellent service and communication. I will certainly be referring them and LoanLeaders to anyone I know who is looking for a loan. Thanks again!
Ann’ette P. from Woodland, WA
I would like to start off by saying that it was a pleasure to work with Zachary. He exemplifies what is to be considerate of the customer. He was always on his A game in helping in anyway that he could. He made himself available at all times and was very knowledgeable as well. Thanks for having him as a part of your team. He is truly an asset!Barrin H. from Homestead, FL
Jason was phenomenal! He worked with us through our issues, and helped us quickly with every roadblock we ran into. I definitely would recommend this mortgage company to anyone I know.Adam M from Elkins Park, PA
Rob has assisted my husband, myself and our families with many, many refinances over the past 7 years. He is very knowledgeable, responsive and goes the extra mile to find the right solution for each client. I would recommend him without hesitation!R Marienlun from Martinez, CA
Jeff did a great job for us with no problems closed on time was very helpful with all our questions. Even a couple years after the transaction was completed he is still there to help answer any questions that may come up.M Reimbold from Yorba Linda, CA