3 Benefits Of Owning A House Vs. Renting One
Posted on: 16 December 2016
If you have been renting for many years and are not sure if you want to buy a house, it's important to fully understand the benefits homeownership offers. Renting can be a great idea in many situations, but buying a home offers some key benefits you may not experience if you rent the house you live in. Here are three main benefits buying a house will offer to you.
Tax and financial benefits
When you own a home, you will receive certain tax benefits that are not available when you rent. For one, you may be able to write off some or all of your closing costs, including points, that you pay when you purchase the home.
You will also have the opportunity to write off the interest you pay towards your home loan, and you can write off the property taxes you pay.
All of these benefits can help reduce your tax liability, which means you may be able to get a higher refund when you file your taxes.
It could help improve your credit score
A second benefit of owning versus renting is the potential effects owning a home can have on your credit score. The only time renting will affect your credit is if you fail to pay your rent on time. Your landlord might put this negative remark on your credit report, and this will cause your score to drop.
When you own a house, the mortgage lender will report to the credit bureaus each month with recent information on your loan. If you make your loan payments on time each month, you will slowly be building positive payment history. Payment history is a huge part of a credit score, and a positive payment history will cause your score to increase.
You will be building equity
The best benefit of all is the equity you will be building in the house that you buy. Equity refers to the difference in the amount your home is worth to how much you owe. While you may not start out with a lot of equity in your new house, over time you will slowly build equity. After 15 or 30 years (depending on the length of your mortgage), your loan will be paid off and you will have 100% equity in your house.
If you are tired of renting a house and are financially ready to buy one, contact a real estate agent in your area to locate homes that are within your budget amount.
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