According to “The Niche Report,” recently, mortgage rates for a 30-year fixed-rate mortgage reached 3.66%. This was after several weeks of record-setting lows. When you consider this with the rising costs of renting, financial experts are recommending that the time is right for renters to think about buying a home. Especially since if the economy does start to improve as projected, mortgages rates will likely go up.

To rent or to own a home is a both an emotional and economic decision for people. Plus, it depends upon your particular circumstances. To help you make your decision, let’s examine each option:

Pros of Renting

• Less money upfront – When you rent, you only have to come up with a security deposit and the first and last month’s rent.
• Flexibility to move – If your job requires you to move around a lot or you just want to check out a neighborhood first, you can rent without making a long-term commitment.
• Income uncertainty – If you’re unsure about your job or income, this can affect your ability to borrow money and pay a mortgage.
• Time to improve your credit – If you have bad credit, during the time you’re renting, you can work to improve your credit so you can qualify for a loan.
• No maintenance – If you have problems with the plumbing or anything else, all you have to do is call your landlord to get it fixed.
• Possible paid utilities – Occasionally, your utilities such as water, sewer, heat or garbage may be included in your rent so you don’t have to pay extra for them.

Cons of Renting

• Rent increases – Your landlord may increase your rent periodically.
• No equity – The money you spent on rent is gone forever. You’re not building equity in your home.
• Limited freedom – You must adhere to your landlord’s rules when renting. This can mean no re-decorating, no pets and/or no smoking.
• Unresponsive landlord – You’re at the mercy of your landlord’s schedule regarding repairs and renovations.

Pros of Buying

• Build equity – With each mortgage payment, you increase how much you own of your home. Plus you can borrow against the equity in your home to make renovations or purchases.
• Tax breaks – You can deduct mortgage interest and property taxes on your tax return. And you may be eligible for deductions when you work from home.
• Customization of your home – When you own you decide how you want to decorate or if you want to remodel.
• Maintenance upkeep – When you own your home, you can make repairs or hire someone to do them for you.
• Pride of ownership – You can live the American Dream of owning your home.

Cons of Buying

• Upfront costs – When you buy a home, you’re required to pay a down payment, closing costs, home inspection cost and other fees.
• Other homeownership costs – You also have to pay property tax and homeowners insurance premiums. Plus you’re responsible for all utility payments.
• Inflexibility – You can’t just move whenever you want.
• Maintenance costs – You are responsible for all maintenance done on your home and the associated costs.

Hopefully these pros and cons will help you make your decision on whether you should rent or buy. If you decide now is the right time for home ownership, contact Grandview Lending. We can take a look at your individual circumstances and find a home mortgage solution tailored to meet your needs.