Buying a home is an exciting milestone. In fact, it is often one of the biggest financial decisions you will make. That’s why there are many factors to consider as you determine whether the time is right for you to go from renter to homeowner.
Understanding your own financial situation is important. But it is also helpful to be aware of the current housing market, interest rates and much more. At VyStar Credit Union, our licensed Mortgage Loan Officers are here to help you throughout the mortgage application process. They have a wealth of experience in helping individuals and families achieve their goal of homeownership.
To help you think through your top priorities and the benefits of renting versus owning, here are a few considerations to keep in mind.
RENTING
What Should I Consider When Renting?
One of the main benefits of renting is the flexibility that comes with it. Whether you are in a job that relocates often, are scouting out the perfect location to buy, or simply want to wait until you have more options, renting can be beneficial. That is also true if you are working to build your credit score with a long-term goal of purchasing a home. However, this flexibility can also come along with unpredictability, such as the rising cost of rent in various parts of the country.
Renting Risks and How to Stay Protected
When you rent a property, there is no return on investment. You also risk a variety of issues such as your landlord selling the building, the aforementioned rent increase, inattentive landlords and/or leasing companies. VyStar offers renter’s insurance to protect everything you value in your temporary home. While this coverage can’t prevent your landlord from rising the price of your rent, it does cover furniture, jewelry, electronics and other personal items that matter to you. Our experts are always available to help you get started.
Benefits of Renting
A benefit of renting is the initial deposit is typically less than a down payment and closing costs when buying a home. When renting, you can generally expect to put down about two months of rent as a deposit. This opens the doors for those who do not have the room in their budget to afford substantial initial costs that come with buying. Another great aspect of renting is that you do not own costly items that may break, like appliances. If you need repairs within your home, you have the advantage of calling your landlord to fix it, rather than paying for repairs yourself.
BUYING
What Should I Consider if Buying a Home?
When you buy a home, you can build equity and credit. Unlike renting, you have the freedom to make it your own with décor and renovations that can also increase the property’s value. You also have the peace of mind that this property belongs to you and provides a place to grow for the future. While buying a home is an exciting period, it’s important to keep in mind the variety of costs associated with this long-term commitment.
Initial Home Costs
The first thing to consider when buying is the initial cost. Upfront payments like down payment and closing costs can be the biggest barrier and turn some away when purchasing a home. While putting 20% down on your house can help you avoid paying Private Mortgage Insurance (PMI), buyers can often put down a smaller percentage. It is important to determine what is right for your financial situation, and being aware of the upfront payments can help you determine if this is the right investment for you.
Additional Expenses of Owning a Home
After the home is yours, there are many additional expenses to keep in mind. Some of these might include mortgage insurance, homeowners' insurance, repairs, upkeep and property taxes.
However, there are different tools that can assist you throughout the homeownership journey. At VyStar, we provide a variety of home loans with low rates to ensure that you have the best option, because finding the right loan is like finding the right home. Our loans can assist you with your mortgage, unlocking the equity of your home and refinancing your home. There are different home loan options to choose from.
How VyStar is Here to Help
Along with loans, VyStar also offers a Homebuyer’s Guide to ensure you are taking all the right steps in buying a home. This guide acts as your financial assistant through managing the process of homebuying and mortgages.
VyStar is here to help throughout this journey and support the decision that is best for you. Our team is here to answer any questions you have and provide the tools you need for a successful financial future. If you have any questions or need to find more information, you can contact the VyStar team.