Renting versus Buying a Home
Posted Wednesday, April 10, 2013
Just because you can buy a home does not always mean that you should. It’s important for you to consider if it is better for you to own or rent a home.
Here are five reasons you might want to rent:
- You may be moving within five years. It usually takes five years to break even on your home purchase or investment.
- You don’t want the responsibilities associated with being a homeowner. It can be expensive and time consuming to maintain a home.
- You have a bad credit report. If your score is below 620, you will not get a good interest rate.
- You have a high debt ratio. A high debt ratio means you may not qualify for a loan.
- You have job instability. If your job is not secure, it’s not a good idea to buy.
Here are four reasons you might want to buy:
- You want to build equity. The longer you own your home the more equity it will build. When you pay rent, that money goes down the drain.
- You get a tax break when you deduct mortgage interest.
- You want the emotional satisfaction of owning your own home.
- It’s an investment. With low interest rates and home prices, buying investment property is a wise decision.
Own or rent a home
Deduct mortgage interest