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Can Buying a Home Be More Affordable Than Renting?

When buying a house, there are a lot of factors to look at.  One of the most important is, of course, whether you can afford the new house or not.  You can do the usual math and find out whether your rent is more than your house payment will be to figure it out, but there are a lot more factors to consider in whether to buy a house or rent.

The first consideration is that you are building equity with every payment.  Instead of throwing money away every month renting a building that gives you nothing but a roof over your head, you are building your financial future with an investment in yourself.  Equity is the backbone of financial independence and needs to be built in order to dig out of paycheck-to-paycheck life.

Another reason to ditch your rent is that nationally, home values tend to increase by 3-5%.  This can be a huge amount of growth for your net worth and lead to leverage like Cash Out Refinances to help pay off credit card debt with that additional equity.

Mortgage rates are, right now, at historic lows.  If you had bought a house a decade ago, you would have paid 6% interest at least.  Right now, loans are going in the 3’s, meaning that you can afford a lot more house than you might think.  If you can pay less in interest on your home, you can afford to take out a larger loan on a bigger house!

You also don’t need to put down a giant down payment anymore.  A Convention loan requires a 20% down payment, but you can get an FHA loan with 3.5% down, or a VA Loan with no money down!  There are a variety of ways to buy a home if you can’t afford a large down payment.  Buying a home isn’t out of the reach of the average person if you talk to the right lender.

You can also deduct Mortgage interest and property taxes off of your personal taxes.  This can lead to a big bonus come tax time, and either a bigger return or a smaller payment come April.

Rental rates will always rise, meaning that you’re going to pay more every month for the home that you live in while you rent.  On the other hand, a fixed rate mortgage will keep your payment the same, and let you budget your household accordingly.

You are also able to really make your home, well, your home!  If you want to build a pool, add a deck, or finish the basement, it’s your property to do what you want!  If you want to put pink flamingos in your garden (no judgement here!) then you’re welcome to.  In a rental, any changes have to be approved by the owner of the rental property, and may result in you paying for damages on top of the additions.

Call The Home Loan Expert Team in St. Louis at (314) 781-9700, Chicago at (773) 770-4727, Indianapolis at (317) 550-1515, or Nashville at (615) 810-8555.  You can always apply online at hero.loan for your VA Loan, and www.thehomeloanexpert.com for your other mortgage needs, and will come to you to help close your loan. We work hard to make it easy on you.  Nobody gets lower rates on better loans than The Home Loan Expert, Ryan Kelley, why go anywhere else?

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