Leaving Your Rental to Buy Your Own Home Is a Big Step.
Currently your landlord has the responsibility of all repairs and upkeep. And depending on your lease, you may not even be paying for your electricity or water. But on the other hand, if your current residence is growing in value, then your landlord is building equity through your monthly payments. Home ownership can have financial benefits that renting does not. While you’ll want to consult a tax advisor, you should find that the interest you pay on your mortgage is tax deductible, as are some closing and moving costs. If you pay points on your loan to reduce the interest rate on your mortgage, that amount is also tax-deductible for that year.
Ace Your Transition
Many renters wait until they are nearing the end of a lease period, or paying month by month, to begin house hunting, so that they don’t pay fines for breaking their lease. This is a good idea when possible, but every situation is different. You may buy a house with immediate occupancy and be able to move within a few weeks. On the flip side— you may fall in love with a house whose occupants aren’t quite ready to vacate.
Are you open to a fixer upper? You might be glad to live in your rental for a short period of time while working on your new home. It’s much quicker to update a house while it’s empty, and not filled with boxes!
When shopping for a home, be as flexible as your finances will allow so you’re not locked into any one situation, which could limit the homes you can consider. Call a Quicken Loans home loan expert to discuss these different possibilities.