One of the biggest expenses you will have each month during life as an adult is the ongoing cost of housing, whether it’s for rent or for a mortgage. Now may be the time to review your individual circumstances and consider your options.
When it comes to your living arrangements, there are two main choices—rent or own. Here are a few practical and financial reasons to help you make the decision that’s right for you.
• Flexibility to move. For those who move often for their work (whether in town or across the country) or just like living in a variety of different areas, renting may be the better option. When you own a home and you want to move, you may need to sell it.
• Maintenance & repairs. When you rent, the landlord/owner of the property is responsible for upkeep and maintenance—they pay for the repairs.
• Amenities. Often apartment complexes offer fitness centers, swimming pools and playgrounds. These luxuries might be quite costly to pay for all on your own.
• No down payment. You won’t need a mortgage down payment; however, when you rent, you may need to pay the first and last month’s rent, a cleaning deposit and pet deposits up front.
• No taxes. The property owner is responsible for paying real estate taxes. And depending on the economy and increases in tax rates, taxes can become a significant expense.
• Ownership. If you feel like you’re ready to put down roots, homeownership may be an excellent choice for you. You may pay more per month to own, but the house is yours—all yours.
• The long term. Owning may be a good option if you plan to stay in one location for a long period of time. By locking in a good interest rate (rates continue to be among the lowest they’ve been in decades), your mortgage payment can remain the same, but rent generally increases.
• No landlord. Because there is no landlord, you can customize your home anyway you want—repaint, remodel, landscape or put in a pool—as long as what you do meets legal codes.
• Save money. According to U.S. News, homeowners buy less furniture because they aren’t always moving to new places with different square footage.
• Taxes. Most homeowners can lower their income tax bill by making mortgage payments. You may qualify for certain deductions based on your interest payments.
• Down payment. Homebuyers often have to put down 10-20% of the mortgage loan as a down payment. However, there are many creative financing options available in the marketplace—some specifically designed for first-time buyers.
• Loan rates. When mortgage loan interest rates are low, as they are currently, monthly mortgage payments are also lower.
If you are considering a home purchase, Mountain America can help you get your dream home.
For more information, visit www.macu.com or call 1-800-277-7703.
Loans subject to credit approval. Membership required—based on eligibility. Federally insured by NCUA. Equal Housing Lender.