Stop Paying Rent


Rent vs. Buying – So Many Advantages
There are many advantages to buying a home versus renting one. View these advantages in the Buy vs. Rent Comparison table below, or view a financial comparison of buying versus renting in the Buy vs. Rent Calculator.
Your income, savings, and monthly expenses play an important role in determining how large a mortgage you can afford. To figure out the amount you can afford, please click Affordability.
Savings: Buying
In many cases, the amount of money a renter spends on rent can be about the same as or less than the amount a homeowner spends on a mortgage. With the tax benefit for homeowners, the savings can be significant.
Buy vs. Rent Comparison
The chart below shows a cost comparison for a renter and a homeowner over a seven year period.
  • The renter starts out paying $800 per month with annual increases of 5%
  • The homeowner purchases a home for $110,000 and pays a monthly mortgage of $1,000
  • After 6 years, the homeowner’s payment is lower than the renter’s monthly payment
  • With the tax savings of homeownership, the homeowner’s payment is less than the rental payment after 3 years
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Years

Rent Payment

Mortgage Payment

Monthly Difference

After Tax Savings

Yearly Difference

After Tax Savings

1

800

1000

-200

-50

-2400

-600

2

840

1000

-160

-10

-1920

-120

3

882

1000

-118

+32

-1416

+384

4

926

1000

-74

+76

-888

+912

5

972

1000

-28

+122

-336

+1464

6

1021

1000

+21

+171

+252

+2052

7

1072

1000

+72

+222

+864

+2664

8-30

 

 

Savings increase every year

 

Monthly Expenses: Buying
Your rental company takes part of your rent payment to cover certain housing expenses. When you decide to purchase a home, you accept responsibility for paying for these expenses (listed below). They are additional costs to your monthly mortgage payment and should be included in your budget estimates:
  • Property Taxes and Special Assessments
  • Home/Hazard Insurance
  • Utilities
  • Maintenance
  • Home Owner Association (HOA) Fee: Doesn’t apply to all purchases. It pays for trash and snow removal and maintenance of common grounds if applicable.
  • Membership Fee: It may pay for recreational facilities and other services (cable TV).
Advantages
Considerations
Property builds equity
Responsible for maintenance
Buy
Sense of community, stability, and security
Responsible for property taxes
Free to change decor and landscaping
Possibility of foreclosure and loss of equity
Not dependent on landlord to maintain property
Less mobility than renting
Little or no responsibility for maintenance
No tax benefits
Rent
Easier to move
No equity is built up
No control over rent increases
Possibility of eviction
Help For Home Buyers (Buyer Page backlink) can provide all the guidance and coaching that you will need to buy your new home. Whether you have good credit or bad, we can help. Our mortgage marketplace (Best Home Loans page backlink) will help you find your options for the best loan and program options for you and your home loan. What is available, but what actually works better for you. Learn your options and how to achieve your goals.
If you are looking for a bad credit mortgage or credit challenged home loan, we can help you with that too. Our “Credit Improvement Program” (Credit Doesn’t Matter Backlink) will help you correct, repair, and improve your credit to achieve your goals. Tired of being turned down with no help or guidance to improve your credit situation? We can help with that.