When Renting Might Be The Best Option For You
More than almost anything, the American Dream is defined by home ownership. Owning your own place is the ultimate sign of adulthood, of responsibility, but homeownership is not for everyone. If you are one of those people, there is absolutely no shame in renting.
Mortgage rates are at an almost all-time low, which is drawing many people into the housing market. Don’t let the lure of almost free money compel you to buy a home before you’re ready though. Here are ____ signs you aren’t ready to buy a home, and you may never be.
You’re a roamer
If you’re like many of our return customers, you like to move. Whether you want to explore the state, the country or the world, you like the freedom of not being tied down to a single address.
Your future is uncertain
If you work for an unstable startup or you have a feeling your job could be winding down, attaching yourself to a 30 year mortgage might not be the best idea. Wait until you’re on pretty high ground, job wise. A few months salary in the bank is always a good idea.
Your credit isn’t optimal
Almost anyone can be approved for a mortgage, which is one of the things that makes homeownership so alluring. Those great rates, though, are reserved for people with the best credit scores. The best rates go to people with scores above 760, followed by above 700 and above 680. If your score is below 680, talk to a credit counselor and a mortgage lender. It might still be advantageous to buy, but waiting it out till you raise your score could be beneficial as well.
You aren’t a saver
Upfront costs to buying a home are high. There’s the downpayment, which is generally anywhere between 3.5 percent of the cost of the home and 20 percent. Note that if you don’t have at least 20 percent equity in your home, you may need to pay for mortgage insurance, which is about 0.5 – 1.5 percent of the home’s value each year. Not only that, if anything goes wrong with your home, the responsibility is all yours. Repairs on major ticket items like roofs and foundations can cost at minimum, $10,000 and sometimes upwards of $30,000 or more.