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Buying vs. renting
Why rent when you can buy? If you are considering taking the steps toward the American dream, you’ll find home ownership offers many benefits that renting does not:
- When you purchase a house, over time your mortgage principal balance will decrease and your equity will increase. Building equity is almost like a forced savings plan. You can use the equity of your house for a down payment on another home, home improvements, college tuition, and other major expenses.
- In many cases, mortgage interest and annual local and state property taxes are deductible from your income tax. In fact, tax deductions can sometimes make it cheaper for you to own than rent.
(Please consult a tax advisor for more information.)
- Renting is influenced by inflation, making substantial rent increases likely over time. The only option to keep your costs the same every month is with a fixed rate mortgage. Costs will then stay the same and stable for the duration of your loan.
- The profit belongs to you when your home increases in value. When you rent, you own nothing and build no equity over time, therefore essentially throwing money away.
- Do what you would like to your own home. Renters are often restricted what they can do to the interior and exterior of their property.
- When your loan is paid off, your monthly payments will stop. Renters will continue payments as long as they remain in the property. A never ending cycle.
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