What’s best for you? If you're currently renting but considering buying a home in the future, you need to be able to afford more than just your house payment. There are several pros and cons to consider.
Purchasing your home offers financial advantages.
- Home equity. Buying a home means that, over time, you may qualify for a home equity loan. Home equity comes in two forms, either in a fixed-term loan or in lines of credit. Learn more about how owning a home can present an alternative to personal loans with home equity.
- Tax deductions. When you purchase a home and pay interest on the mortgage, that interest is tax-deductible. Real estate taxes are deductible as well.
- Ownership. When you buy a house, you can make whatever changes you'd like — painting the walls, building additions, having pets, etc.
There are also extra costs to owning a home that renters don't face.
- Homeowner’s insurance. You’ll want to purchase insurance for your home in case any unexpected disaster occurs.
- Property taxes. When you own your home as opposed to renting it, you are responsible for paying property taxes. For renters, landlords cover those costs
- Maintenance. Houses require regular upkeep, and if you want to keep yours in good shape, you’re going to have to pay for regular maintenance.
Buying a home means that you'll actually have ownership over where you live, but it's not always the best choice for everyone.