We understand home buying can sound like a scary thing and a big commitment. It’s okay to sit and ponder the home buying process, but waiting around too long is not good, especially with rising rent prices that don’t seem to be slowing down anytime soon. Whatever your reason for renting is, here are five reasons why you should reconsider and leap into homeownership.
Owning a home is less expensive than renting
Surveys have time and time again revealed that financially it is cheaper to buy a home than to rent, and this year’s statistics provided by gobankingrates are no different. According to their research, it states that in 39 states across the country it makes more sense to buy a home than to rent. With rent prices nationally increasing at 2.9% annually buying a home now might just make sense.
As a homeowner, you will receive tax breaks. As a renter, you might receive your deductible (questionable) once you leave the place. The biggest tax break you receive as a homeowner is from the house payment you make every month which charges you interest that is deductible. Aside from that, as a homeowner, you will also be able to write off all kinds of expenses. Unfortunately, the same cannot be said for renters.
Down Payments are a lot less
Remember when you had to sell an arm to make a $20,000 down payment to buy a home? Well, that’s not the case anymore. There are many options today such as an FHA Loan, which you can qualify with a fair credit score, that only requires you to put down 3.5 percent. Fannie Mae’s conventional 97 mortgage requires just 3 percent down.
It is okay if you have lower than average credit
The myth of having a near perfect credit score to get a loan has been busted, it is just not true today. The average credit score of buyers who finance using an FHA loan is 683. And for those who use non-FHA financing have minimum scores of 600.
One of the biggest benefits of owning a home as opposed to renting is equity. When your home’s equity rises, that equity is yours and you can use it however you please.