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Renters Have Much to Achieve by Pursuing Home Ownership

posted by Stephen Katz @ 8:52 PM
Monday, February 7, 2011

Buying a house vs. renting is really a big decision that takes careful consideration, as most mortgage consultants will agree. But the benefits of home ownership are great. For years, purchasing real estate has been considered a very profitable investment. It’s an achievement that provides pride, financial balance and potential taxes advantages.

Yes, there are specific responsibilities associated with running a home. Landlords will often argue the advantages of renting, with obvious reasons. If you’re renting, you’re assisting them make their own mortgage payments.

The numbers tend to be staggering if you view it this way. If you’re paying $1, 000 monthly for a condo, and you understand your rent increases 5% every 12 months, then over the following five years you’ll pay your landlord $66, 309. If you’re currently renting a home, you may be paying a lot more than that every month. Either way, you will get no equity by spending this monthly housing expense and you certainly won’t benefit once the property value rises!

However, if you were to buy your own home or condominium, you would be well on the way toward building collateral within that exact same five-year period. By selecting a fixed-rate loan plan, you can possess the comfort of understanding that your monthly mortgage payment won’t ever go up. Actually, you would have the choice of refinancing to some lower interest rate at some time in the future should interest rates drop, and this could cause your month-to-month mortgage commitment to actually decrease.

In addition to building collateral, there are tax advantages which come into play along with home ownership. Based on your tax group, owning a home is usually less expensive compared to renting. Interest payments on the mortgage below $1 zillion are tax-deductible. Your loan consultant can assist you in evaluating the tax benefits of various loan programs, and will share these details with your tax consultant to provide feedback.

To find the actual loan program that’s right for you, your mortgage consultant will have to evaluate your month-to-month household income, present assets and liabilities that include any monthly obligations for credit card payments, car obligations, child support, and so on. These prequalification facotrs, along with your credit score, will determine how much house you are able to afford and what interest rate you qualify for. It’s also important for your mortgage consultant to understand your financial goals in order to identify the loan options that best fit for your own long-term needs.

Housing is a cost that takes a large bite from the monthly budget. If you’re a renter and believe home is a lot more than just some place to hang your hat, consider the advantages of purchasing property. Now may be the time for you to take action into building your own individual net worth, instead of your landlords.

Stephen Katz

(770) 309-0939 (direct) or (866) 742-8400 -- For the past 18 years, Stephen Katz has built a successful business almost entirely on referrals. As your mortgage consultant throughout the home loan process, Stephen will explain the pros and cons of all available mortgage programs and help you choose the financing option that is best suited to your needs. Throughout the loan process, he will keep you informed and will respond quickly to your requests with answers and solutions. Consistently a top producer, Stephen is a Mortgage Bankers Association "Diamond" Award winner, a Georgia Mortgage "Top Gun" and has closed almost half a billion dollars in loans. Put his knowledge and experience to work for you!

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