Renting Is Not Smart – It’s Time To Be A First Time Home Buyer
The worst thing you could do is to go rent an apartment or lease a home. We cannot stress enough how much you are losing out on stabilizing your finances if you are choosing to pay rent for anything to take care of your housing needs.
Before I begin to explain the main financial reasons to avoid renting, let’s look at what you’re missing out on living space wise. We’ve ran some very basic examples to show what a monthly payment would be for certain loan amounts, but we’ll stick to a very basic $100,000 mortgage.
So, for $435.21 a month, you could own homes like this ( These are actual homes for sale at $100,000):
If it’s room and privacy you crave, there’s no reason to not go through what it takes to own your own home. Again, I’m going to restate the main principle here – you need to be able to pay back the lender. Getting a mortgage loan will always come down to that fact.
But enough on those silly lenders, let’s talk about the benefits YOU get by buying a home. I’m not going to go in to a ton of detail that make this an overwhelming argument that would make you stop renting immediately, but instead I’ll plant an idea in your head. So no matter what you’re paying every month renting, just know that you could instead be paying that exact amount to a lender for your home. So instead of a $1,000 rent payment going in to the wallet of someone else, that $1,000 is going towards owning more and more of your home.
Home owners have the ability to take out home equity loans. Meaning they can redeem the amount of money they’ve paid into their home at any given time and in case of emergencies. If you’re renting, you have no home and no equity to take this loan out against.
Let’s look at this $1,000 payment over two examples.
Home Owner: Pays $1,000 towards his loan every month and after 5 years ( 60 months) of payments, has paid $60,000 to which $40,000 has gone into equity. Now when family or close friends want to go on a $5,000 vacation or bad situations require them to pay $5,000, they simply go to their bank and take out a home equity loan and handle the situation and go on vacation and continue life as normal.
Renter: Pays $1,000 to his land lord every month and after 5 years ( 60 months) of payments, has paid $60,000 total to which $0 has gone into equity. Now when family or close friends want to go on a $5,000 vacation or bad situations require them to pay $5,000, depressing times follow. The vacation is out of the question and the emergency has now caused more problems as additional loans and debt must be accrued to take care of it. Now the renter owes family or a bank money back at high interest rates because of the lack of equity to provide for collateral.
The money you pay for your housing needs is the largest amount you will most likely pay on a month to month basis. Are you going to keep burning your money and hard work into something that has no longterm value or will you start the process of getting a home?
That’s what we help people do here. Most people aren’t home owners because they don’t know what and how to do it. Helping renters become home owners is a passion we have here – it takes 20 seconds to fill out a form and have someone here get in touch with you and walk you step by step through the process of making this important financial decision.
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