Why rent when you can own for the same monthly payment?
Stop helping your landlord build equity! Help yourself instead!
The Benefits of Buying a Home -
- Build Wealth
While not guaranteed, your home can be an appreciating asset. Many financial experts will tell you that real estate is still a great long term investment. While one cannot expect the same growth that we've witnessed the last few years, it is not unreasonable to expect a small net percentage growth over a few years time.
For example, if you buy a home or condo for $200,000 and it appreciates 5% per year, you will have built up approximately $50,000 equity in 5 years.
- Tax Deduction
The interest and real estate tax portion of your mortgage payment are tax deductible which will give you a lower after-tax payment. Consult your accountant to determine your tax benefits.
- The Pride of Home Ownership
There's simply nothing like owning your own home. Stop providing your landlord with a huge tax break and paying down their mortgage, when you could keep the benefits of homeownership to yourself.
Rent vs Own Example:
Purchase $200,000 condo with zero down payment or rent $1,200 per month?
Assumptions:
Down Payment : Zero Down
Primary Loan : 80% of Loan Value, 5/1 Arm Interest Only program with 5.25% rate (5.30% APR)
Secondary Loan : 20% of Loan Value, 6.75% rate
Tax Benefit : $3,000 year real estate taxes, $200 association dues, and 28% tax bracket
Appreciation : 5% per year
Rent Own
1st mortgage payment-interest only or Rent payment $1,200 $700
2nd mortgage payment-interest only $0 $225
Real estate taxes $0 $250
Association dues $0 $200
PMI-Private Mortgage Insurance $0 $0
Total payment $1,200 $1,375
Tax savings monthly $0 $329
After-tax payment $1,200 $1,046
Assets Value after 5 Years $0 $50,000
Analysis - If you plan on renting an apartment for $1,200 month you could buy a $200,000 condo with zero down payment and pay a monthly payment of $1,375, with a $329 savings per month on taxes and interest. Therefore, your monthly net payment would be $1,046 on an after-tax basis. You figure out your budget with net pay not gross pay...right? Finally, don't forget you will also be building up wealth through appreciation in value of the property. Who do you think should be building the wealth...you? Or your landlord!?!
More Rent vs Own Info
Home Mortgage Loan Links
Home Mortgage Loan
Buying a Home?
Pre-qualify for FREE today by:
- calling TMG Finance at
800-5000-TMG
(800-500-0864)
- filling out our quick, no obligation form
Home Mortgage Loan Online Application
- emailing us at
info@tmgfinance.net
