Purchasing a home is an enormous and life-changing decision that can be a very positive financial move. It can also be a very large commitment as many mortgages are based on anywhere from 10-30 years. Renting a home is less of a commitment and something that many people choose to do before buying a home. There are many pros and cons for renting a home vs. buying a home.
The pros of renting a home instead of obtaining a FHA home loan include:
If you are paying rent then you are not committed to paying a home loan. A typical rental agreement can be anywhere from one year to six months to month-to-month. This offers a very small level of commitment on the part of the renter. If you are nomadic or like a lot of change in your life, then renting is a good option for you. If you are renting then you also do not have to do any home repairs that come with owning a home. If your toilet clogs, you can call your landlord to call the plumber. If your septic tank backs up into your kitchen sink, then you can call your landlord to come and take care of it for you.
The cons of renting a home instead of paying a home loan include:
This is not your place. When your rental agreement comes to an end, the landlord can decide to kick you out. The landlord can also decide that he wants to move in or have other friends or family move into the house, leaving you homeless and looking for another rental agreement with a new landlord. You are also dumping your rent money into someone else’s mortgage. If your landlord has taken out a FHA mortgage, then you are paying his bills for him. Yes, you are also paying for your place to live but this does not offer any type of long term financial gain on your part. Rather, you are only paying for your place to live each month. You will not own any part of this place after you move out.
The pros of owning a home and paying on your home loan include:
You own the home! Whatever money that you put towards the home is an investment in your financial future. You can do home restorations and know that it will raise the value of the home that you owe. You can also make whatever home restorations that you want to the home since it is yours. You can landscape the yard to your pleasing and add on a room to the home if you so desire.
The cons of owning a home instead of paying rent include:
You have to make all of the home repairs and incur any costs that are associated with the home. Even if you choose to rent out the home, then you become the landlord and must incur the costs of anything that goes wrong with the home.
There are many pros and cons to each and it really depends on if you are choosing to invest in your financial future or want to continue roaming around. If you choose to purchase a new home, there are many FHA approved vendors such as http://www.govfhaloans.com that can help you along the way.