If you’re considering whether it’s time to stop renting and purchase a home, we want you to keep in mind that the interest rate on renting is 100%.
However, renting has its perks. No maintenance costs, no down payment, flexibility to move, no concern about property value. But the truth is your monthly rent payment is just like paying 100% interest month after month after month.
You see, when you toss the financial jargon, interest, at its simplest, is the fee you pay to live in your home. When you rent, that’s what you’re doing. You’re paying a fee month after month, gaining nothing other than a roof over your head.
When you buy, yes, you’re paying a fee (your mortgage) month after month, but you’re gaining SO much more than just a place to call home. You get:
– An appreciating investment
– Increasing equity (every month, the bank owns less of your home, and you own more!)
– Predictable housing costs (a fixed-rate mortgage will never change)
– Advantages come tax time
– Freedom to personalize however you choose
In almost every situation, it pays to buy vs. rent.
