To Rent or To Buy
Owning a home is a great investment, particularly at this time. Interest rates remain at historic lows and the real estate market is strong. Home prices continue to rise so the longer you wait the more a new home will cost.
It is recommended to have a 20% down payment to get your best mortgage payment. The goal of a 20% down payment can be daunting. There are some banks and credit unions that can help you with your journey. They have accounts or offer CDs that are specifically designed for saving for a home. These programs generally come with a slightly better interest rate than normal savings accounts. There are generally no penalties for early withdrawal provided it is used to purchase a new home. There are mortgages that can be obtained for less than a 20% down payment but will cost slightly higher with the necessity of mortgage insurance.
It’s never too early to consult with a home mortgage company to discuss your qualifications. A mortgage professional can get you pre-qualified and estimate the amount of home you can buy. If your credit is not quite where you would like it to be, they can refer you to other financial professionals for advice or improving your credit.
The longer you wait the more money you’re pouring into rent with no return on your money.