Rent or Buy? Tips for Making the Right Housing Choice
Although many people dream of home ownership, other people find that rental living is right for them. There is no right answer when you’re trying to decide between choosing a home mortgage loan and signing a lease. Because everyone’s situation is different, you can only consider which option is a fit for you. As you try to make this important decision, consider these factors while you weigh your options.
Consider When You Will Want to Move
If you are committed to staying in the area in which you are currently living, then buying a house could make sense for you. When you purchase a home, you will generally need to stay in it for at least five years in order to make back your upfront expenses on the house and get a return on your purchase. If you think you could want to move to a new area in less than five years or that there is a good chance you could be transferred because of your job, renting may make the most financial sense.
Add Up Your Down Payment Savings
Generally, to get the best possible terms on home mortgage loans, you will need a down payment of 20% of the purchase price of the home. Although you can find loans that require lower down payments, you will likely have to carry mortgage insurance until you reach 20% equity in the home. Mortgage insurance can be costly and will drive up your monthly payment considerably. Instead of making a low down payment, consider renting until you can save up more money.
Take a Hard Look at Your Job
If you’re satisfied in your career and have stable employment, then you could be ready to take on the responsibility of mortgage payments and the other costs of home ownership. However, if you’re planning a career change or think that your employment is at risk for any reason, you may wish to rent until you are on steadier ground.
Let the experts at GCS Credit Union in O’Fallon explore your options for home mortgage loans and make the right financial decision for your personal goals. Talk to a credit union representative today by calling (618) 797-7993.