Buying Your Katy-Cinco Ranch-Richmond Area Home For the BEST Price
Katy-Cinco Ranch-Richmond Area Home
For the BEST Price
Chapter 5 Affordability, renting vs. buying, community choice, schools, taxes
How do I know for sure how much I can afford?
We have found that affordability is probably the single biggest concern of today’s first time home buyers. Our advice is: Don’t sell yourself short! Talk to us as real estate consultants. We are committed to honestly and responsibly working with you to determine your affordable price range. There are many financing options available today and some include very low down payments. Our team will find the option that best fits your budget. You may be surprised at just how much home you can afford!
How does buying compare to renting?
Renting offers a lifestyle that’s nearly maintenance free. That may appeal to you, but consider that renting offers you no equity building, no tax benefit and no protection against regular rent increases. If your rent has averaged $1000 per month for the last ten years, you have spent $120,000 with nothing to show for it. Meanwhile you have helped your landlord pay his mortgage with your rental payments. Isn’t it time that you invested in yourself instead of your landlord????
Several financing options are advantageous for first-time home buyers or families with limited cash. FHA and VA mortgages, as well as, many conventional mortgages offer you very low down payments. You may also consider borrowing cash for a down payment from life insurance, a retirement plan or your parents.
Today’s mortgage rates make home buying as affordable as renting, especially considering current high rental rates. Let’s assume that you would like to buy a home that costs $150,000. After putting down a say a 5% down payment you would owe $142,500. If you get a mortgage at 4% for 30 years the monthly payment would be $680 for principal and interest. Of course you would have taxes, insurance and mortgage insurance which could run another $400 per month. If you are buying an older home you should put aside a reasonable amount for maintenance each month.
You will also realize a tax deduction for interest paid each year. This may help you to qualify for additional deductions that you were not eligible for before owning a home.
Best of all you will be on your way to owning your piece of the AMERICAN DREAM.
Next Chapter: Mortgages