Author: Best Home Loans
Deciding on a house for lease or rent can be confusing. Here are a few things to think about before deciding.
Some good reasons to rent a home are:
Generally, the costs stay the same during the life of the lease.
Your home doesn't gain or lose equity.
If you decide to move, you can as soon as the lease is up, without incurring any penalties.
Since you are renting, you have very little to have to worry about as far as keeping the property maintained.
Usually, the money you have to pay when you move in is small, compared to buying a home.
Reasons that are not so good to rent are:
Whatever happens to the homes value, you will never gain equity.
You are not able to make the place what you want it to be, because you will never own it.
If there are any tax advantages to renting, your landlord would be the one to profit from them, not you.
When deciding on a house for lease or rent, some good things about leasing to own are:
Even if the value of the home does not go up, the mortgage balance goes down, and equity goes up.
You can change and/or add on to the home all you want, since it will be yours.
A lot of times, there are great tax breaks to be had by simply owning a home.
Here are some not so good reasons for leasing to own:
Costs can change all the time.
In order for you to move somewhere else, you will usually have to sell your home first.
If the house needs repairs or remodeling, you have to do the work yourself, or pay someone else to do it.
The upfront costs are much more; the option fee is usually 3-5% of the home price.
Be sure that whether you decide on a house for lease or rent, that you research all available information, and take all of the variables into account.
Make certain that if you decide to lease to own, that you can afford the month to month payments. These charges are usually higher than renting, because you have to pay the option fee in your payment each month.
If you choose a house for lease, ask yourself if this is where you want to live first. After you buy, the house will probably have to be sold before you can move out.
When you rent, there are less things to have to worry about, but the place will never be yours to fix it up the way that you want it to be.
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