Renting Versus Buying A Home

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Learn here about renting versus buying a home.


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It's an established fact that buying a house creates potential for tax credits. But how many renters are planning to take advantage of this? As you read the following article, I am confident you'll ask, "How can I NOT own a home?"

Keep reading for new insight into becoming a homeowner.

Can You Afford Renting Instead Of Buying A House

It's true! Buying a house can be more affordable than renting. But even more, home ownership is part of our American heritage.

I understand it's not always possible to buy a home. But when the time is right buying a house creates many financial advantages that you cannot afford to overlook. I know. I have personally helped thousands of people buy a home.

1. Call The Plumber - Renting Versus Buying A Home

Why would anyone want to rent? Let's consider the rent vs. buy theory. The only advantage to renting in my opinion is that sometimes you can rely on the landlord for routine maintenance.

But if you have been a renter, you know that relying on your landlord when the water heater starts leaking over Labor Day or the dishwasher quits running in the middle of a cycle is never a pleasant experience.

2. Building Equity - Renting Versus Buying A Home

The first and most obvious disadvantage to renting is that you lose the opportunity to create equity. So let's start talking about buy vs. rent.

When you pay rent what do you get in return? Well, of course, you get a roof over your head.

But where does the money go? To the landlord who uses it to pay the mortgage. Over time he reaps the advantage of equity appreciation.

Instead of benefiting the landlord why not buy a house instead of renting? Over time, your house will increases in value and it will be you who enjoys the benefit of creating equity.

3. Tax Credit - Renting Versus Buying A Home

Not everyone is sure they can afford a mortgage payment. But the United States Government may be able to help with some of that.

The government wants you to own a home. So it allows you to write off a percentage of your mortgage interest payments when you file your yearly tax return. This means homeowners usually pay less in taxes vs. their friends who rent.

In addition homeowners can take property taxes as a deduction against income. Other deductions may also be available. Remember, is always wise to ask a CPA (certified public accountant) how tax laws relate to you.

4. Future Plans - Renting Versus Buying A Home

Another disadvantage to renting is the increase in rents. In general, rents rise. You can count on that. So owning a home is a way to protect against rental increases.

As your income grows over the years, you can plan for your future knowing that your house payment will remain steady. This benefit may seem small but eliminating the fear of rising rental costs over time gives many families the security to plan for college, retirement or care for aging parents.

5. Individual Style - Renting Versus Buying A Home

Another advantage to buying a house is the ability to freely decorate and landscape your home. Even if a landlord were to allow decorating, you are unlikely to create a style that truly reflects you.

After all who wants to pour their hard earned money into a house belonging to someone else.

6. Pride Of Ownership - Renting Versus Buying A Home

Buying a house allows you to create a home. Paint inside and out according to your individual taste. You can make improvements like planting the palm tree you always wanted, feeling comfortable knowing your house is a reflection of your personality and style.

We often call this pride of ownership. This is America at its core.

That is because buying a home, building equity, establishing financial security for our families, and expressing that in our communities makes us all better citizens.

7. Pursuit Of Happiness - Renting Versus Buying A Home

Ultimately, having a place that we call our own is part of the American Dream. It makes us happy and isn't that what our forefathers meant when they wrote in the constitution that we have the right to life, liberty, and the pursuit of happiness.


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Prime Real Estate Articles Tip No.42

Home Mortgage Application | Holding Title

Holding title is often confused with being responsible for a mortgage. But owning and owing are two distinct topics.

As different as renting is to owning a home, so is being on title vs. being party to a mortgage.

Think of it like this. Title is to ownership as mortgage is to indebtedness. But Kate, I hear you asking, isn't getting a mortgage really the same as holding title?

It's understandable to be confused. Here are a couple of examples to clarify.

  • Miriam buys a home before getting married to Scott. She wants the home to be jointly owned between them. So Scott is added to title. Because the mortgage is fixed at 5.5%, they do not want to refinance yet. So the mortgage remains solely in Miriam's name and only Miriam owes. But Scott and Miriam are joint owners because they both hold title.
  • Now consider Jack and Chanda. Friends during college, they decide to take advantage of buying a house. A few years after graduation, Chanda gets married. So Jack signs over his ownership interest to Chanda's new spouse. Chanda and her new husband hold title together. But Jack and Chanda remain responsible for the home mortgage until it is refinanced the following year.

So remember it this way. Title equals owning. Mortgage equals owing. Easy, right?

Always refer to your mortgage holder and/or and attorney for title requirements which vary state to state. Ask how changes in title could affect your mortgage too.

Take the guided tour with Kate's unique tips for filling out your home mortgage application...

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