Buying vs. Renting
For many, the benefits of buying a home outweigh the advantages of renting. With today's low mortgage interest rates and rents on the rise, now is an affordable time to finance a mortgage with a fixed monthly payment lower than rent.
If you plan to stay in your home for more than six years, buying a home could save you thousands of dollars over renting. And don't forget about the noisy neighbors upstairs.
THE BENEFITS OF BUYING
Mortgage loan interest may be deducted from your state and federal income taxes and a portion of your property taxes may also be deducted.
Fixed mortgage payments (principal and interest) will not change during the loan term whereas rent payments may increase annually.
Owing a home long term allows equity to build and thus
your home investment to grow.
THE BENEFITS OF RENTING
Renting may be the preferred option for those planning or needing to make a move in less than six years.
LITTLE OR NO MAINTENANCE
Renters are often able to rely on landlords and
property managers to pay for and make necessary
UTILITIES MAY BE COVERED
Some utility expenses may be included in monthly
Contact me today to start realizing the benefits of homeownership.
Please consult a tax professional about your specific situation and the tax savings benefits of homeownership.
5 questions to ask yourself before buying a home
Exploring the idea of buying a house can be an exciting, nerve-wracking and uncertain time. Late night browsing on housing websites, trying to figure out which neighborhood to live in and what your priorities are can be as overwhelming as it is thrilling. To help you out in this life adventure, here are five questions to ask yourself before you apply for a mortgage and start packing:
1. Is the mortgage realistic?
Are you really in a place to buy a five-bedroom home with a pool? Sure, the listing price may have dropped a few thousand dollars in the past month, but be realistic when setting a budget and remember that any purchase is never a good deal if you can't afford it. When considering conventional mortgage rates and your long-term future, don't just try to picture yourself paying that amount for the rest of the year. Instead, picture yourself paying that mortgage every month for the next five to 10 years. Are you able to pay a sizable mortgage this year because you had a strong quarter with high commission earnings or a raise? Do you expect your income to increase or remain the same for the foreseeable future?
If you're stretching your budget, you can calculate some small sacrifices and adjustments to see whether a mortgage is feasible. When you consider eating at home more frequently and traveling less, however, also factor in how this will affect your quality of life. Most people could stand to tuck more money into their savings accounts or put it toward a mortgage, but if you love your weekly nights out and yearly tropical vacations, decide what's really important and whether the extra bedroom is worth it.
2. What will the commute be like?
Whether you're moving across the country for a new job or relocating to the suburbs for a bit more space, be sure to take into account your daily commute. Again, it's all about quality of life - an extra 10-15 minutes for better schools and a backyard is probably worth it, but if you're looking to increase your commute by 30 minutes or more each way, remember that this will affect your daily life in a tangible way. An extra hour each day, for example, adds up to about 250 hours per year.
There's no wrong answer here - if you're fine with a longer commute and have options such as express commuter trains or live in an area with less traffic than average, a few extra miles won't matter as much. Decide what you're comfortable with and how a longer commute may positively affect your budget or negatively affect your daily life and adjust accordingly.
3. Will you want to stay long-term?
Opting for a starter home as a first-time buyer is a great option to enter the housing market without breaking the bank, but that doesn't mean you have to settle. For instance, a smaller ranch home may be the perfect option if it's in a desirable area that you can picture yourself staying in for a few years.
Make sure you pay special attention to your surroundings. If you're moving from the city to the suburbs and enjoy the hustle and bustle of an urban area, you may want to move to a location with a thriving downtown area complete with walkable streets and access to coffee shops and restaurants. You're not bound to staying in a home for decades, but the moving and buying process is significant enough that you should try to imagine whether you'll be happy in a house and neighborhood for at least a few years.
4. Have you included extra costs?
It may not be as fun as looking for your dream home, but the devil is in the details, so make sure you're calculating the extra costs such as water bills, electricity, gas and home repairs. If you're a first-time buyer, you may not be accustomed to undertaking your own plumbing repairs (goodbye, landlord), so take note of any property changes you'll need to make upon moving.
What's more, according to U.S. News & World Report, homeowners will spend between 1% and 4% of a home's value on maintenance costs each year. That can add up to thousands each year. A little planning and budgeting can go along way, so keep these expenses in mind.
5. What's the future of your family?
Are you planning to have kids? Do you predict you may become a caretaker for an aging parent over the next couple of years? A home is a long-term investment, which means you should always keep the future in mind when deciding on buying a property. If you're a new parent, you should ask yourself whether you plan to have more children in the future. If so, should you get a house with an extra bedroom, or do you plan to move when your children are still young enough to comfortably share a room? Do you imagine your kids playing in a spacious backyard, or are nearby parks plenty for your family?
Or, if you've arranged to take care of a parent in the next few years, you may want to find a home with a first-floor bedroom with an easily accessible bathroom for someone with mobility issues. For that matter, if you're looking for a home to live in well into your retirement years, the same applies - what will your life look like in the coming years, and how will your living space fit into those plans?
There are many things to think through when buying a home, including these kinds of practicalities and long-term thinking. By taking your time while planning the next several years of your life and looking for a home that's worth the effort, you'll be able to enter the homebuying market with your eyes open, ready to find a home that's the perfect fit for your life.
Academy Mortgage is one of the top independent purchase lenders in the country as ranked in the 2016 CoreLogic Marketrac Report. Visit www.academymortgage.com to find a loan, get a rate, or calculate your payment today.
Tips for a Simple Loan Approval
Here is a list of useful tips to facilitate an effortless loan process. These DO’s and DON’Ts will help you avoid any delays and costly challenges with your loan approval.
If you encounter a special situation like identify theft, it is best to mention it to us right away so we can help you determine the best way to achieve your goals.
DO call us if you have any questions.
DO provide requested documentation promptly and in its entirety.
DO continue living at your current residence.
DO continue making your mortgage or rent payments.
DO continue to use your credit as normal.
DO keep working at your current employer.
DO keep your same insurance company.
DO stay current on all existing accounts.
DO expect requests for additional documentation throughout the loan process.
DO let us know if you will be receiving gift money before it is deposited into your account.
DON’T change your employment status.
DON’T make any major purchases (car, furniture, jewelry, etc.).
DON’T change bank accounts.
DON’T make any large cash deposits into your bank accounts.
DON’T transfer any balances from one account to another.
DON’T close any credit card accounts.
DON’T consolidate your debt onto one or two credit cards.
DON’T apply for new credit or open a new credit card.
DON’T max out or overcharge on your credit card accounts.
DON’T take out a new loan or co-sign on a loan.
DON’T pay off any loans or credit cards, charge offs, or
collections without discussing it with us first.
DON’T finance any elective medical procedure.
DON’T join a new fitness club.
DON’T open a new cellular phone account.
DON’T have your credit pulled or dispute any information on your credit report.
DON’T pack away or store any important documents, even if they aren’t initially requested.
Let us show you how simple securing a home loan can be.