You may be at a point when you feel that you should buy a house instead of renting. Everyone is telling you that renting is simply throwing your money away, and that you aren’t building any equity. You are not sure if you are ready to make the leap into home ownership. Here are a few financial aspects to consider before deciding.
1) Often people will buy a home before they are truly ready and finance it at one hundred percent through a variety of methods. If you find that you need to do this, you should carefully consider if you can truly afford owning a home. Do you have enough to cover the insurance and taxes or will that be included in your mortgage?
2) If you feel that you may be stretching yourself to make payments, but that it will be okay because you will be building equity, you might want to reconsider. You need to have money to cover expenses like the water heating breaking down or to fix the leak in your basement. When you buy a home you are taking on a greater responsibility. It is important that you are ready for it.
3) Real estate is an excellent investment, but it still needs to be maintained and well cared for. You should look into the future as you buy a home. You should buy somewhere where the property value is increasing rather than decreasing. You should try to buy in a neighborhood that will still be safe when you are ready to sell. As you consider these things you will make a better investment.
4) If you are renting, you may decide to put aside the extra money you would pay on the mortgage, and homeowners insurance. You can use this for a down payment on your home, while you are giving yourself the opportunity to see if you can truly afford the home that you want to live in.
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