Ask the Lender – Should I Buy a Home or Continue to Rent?
If you’re considering purchasing a home, now might be the time. With the Fed recently raising rates and indicating they plan to again this year, interest rates on home loans will begin to tick up. However, that shouldn’t be your only deciding factor in jumping into home ownership. You’ll need to take into account the cost of home owner insurance and property taxes, as well as Private Mortgage Insurance (PMI) if you won’t have 20% to put towards a down payment. Home ownership also comes with maintenance and you’ll want to consider those costs, as well as the time involved in activities such as mowing a lawn, that may currently be taken care of by your landlord.
The positive side of owning your own home means you’ll have a long term investment and you have something to show for those monthly payments. Also, according to rentalhousingjournal.com, 2015 had the highest rent prices in recent history as demand for rentals continued to grow, so your house payment may indeed be less than what you’re currently paying in rent. On a national average, renters can expect to spend 30 percent of their income on rent, while buyers can expect to spend 15 percent of their monthly income on a mortgage payment. Buying a home is one of the biggest decisions you’ll probably make in your lifetime. Make sure you’re comfortable with your finances and understand the total cost of home ownership by using our Rent vs. Buy mortgage calculators. This calculator helps you weed through the fees, taxes and monthly payments to help you make a decision between the two options. When you’re ready to purchase, contact a Citizens National Bank mortgage lender to help you through the application process and understand the mortgage options available. – See more at: www.cnbohio.com/Personal/Loans/MeetOurLenders/AskTheLender/Default.aspx
If you would like to submit a question for this column, email firstname.lastname@example.org.