You may be considering taking advantage of the record low mortgage rates and committing to homeownership, but you’re not sure if it makes sense for your situation and if it will be financially beneficial in the long-run. Here’s a breakdown of the pros and cons of renting, the pros and cons to buying and a calculator to help you determine which makes more sense for you.
If you move around often or simply don’t plan to live in the town for longer than five years, it may make more sense to rent your home. Additionally, if you already have a high amount of debt, are behind on retirement savings and have little cash on hand, you should focus first on stabilizing your financial situation before buying a home.
If you’re in good financial standing, have funds for a down payment, and have an acceptable credit score, you may be ready to buy a home. It is also a good idea to have an emergency fund that would help cover unexpected maintenance costs and even mortgage payments if you are unfortunately faced with reduced income.
Do the math!
Use our Rent vs. Buy financial calculator to determine how renting and buying compare in your specific financial situation. Simply plug in your monthly rent and rental insurance costs, as well as a variety of predicted homeowners expenses and click calculate!