Owning a home is a goal that many families strive to achieve. However, many prospective home buyers are not convinced that a favorable outcome will result from an application for a mortgage loan. Internet Loans Direct highlights some of the benefits of buying a home versus renting.
About Homeownership
For many decades, The American Dream has been to own a home. After completing the closing of escrow, many first-time home buyers realize that the process is easier than previously imagined.
Getting the keys to a place that you own is a priceless moment. Typically, the excitement begins when a new homeowner begins to imagine some of the possibilities that the residence will have for her family.
Thoughts about decorating, renovating and social gatherings may begin to swirl around, as a variety of limitations may have existed in a rental situation.
Payment Stability
When renting a property, such as an apartment, a condo or a single-family home, a tenant may encounter annual rent increases.
Over a period of a few years, a tenant could end up paying several hundred dollars above the initial monthly rental rate. This is problematic, as a tenant’s annual wage increase might be lower than the annual rent increase.
Buying a home can provide the owner with payment stability via long-term financing, such as a 30-year fixed-rate mortgage or a 15-year fixed-rate mortgage.
Knowing that the principal and interest portion of a mortgage payment will not change for the life of the loan is a major benefit of owning a home versus renting an apartment.
Neighborhood Stability
Generally, in communities where there are primarily homeowners, the neighborhoods are more stable. Whereas, in rental markets that are filled with residents who often commit to an annual lease renewal or a month-to-month arrangement, the neighborhoods are more transient.
Increased Net Worth
Unlike paying rent to maintain somewhere to live, a homeowner builds equity with each mortgage payment.
As each monthly mortgage payment is made, a portion of the payment is applied toward the principal mortgage balance.
Therefore, a homeowner can steadily build his wealth as property values increase and the outstanding mortgage balance decreases. It is important to mention that the Consumer Financial Protection Bureau wants home buyers to know that property values can fluctuate in an upward or a downward direction.
Additionally, a homeowner might be able to write off a portion of the mortgage interest payments and the local property taxes (Speak with an accountant for details about your tax situation).
Contact Internet Loans Direct for information about getting pre-approved for a home mortgage loan.
Contact us today for more information about purchasing or refinancing a home.
Phone : 888-836-6287
Email : info@internetloansdirect.com
Website : www.internetloansdirect.net
