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Rent Versus Buy

To Rent, Or To Buy?

That is the big question, isn’t it? The decision to buy a home can be a tough one. In fact, it’s one of the biggest decisions you’ll ever make in your life. It’s helpful to understand the benefits of buying versus renting so you can make an informed decision.

Just remember - renting and buying aren’t fundamentally good or bad. What matters most is doing what’s best for you and your future.

Black dog sitting in cardboard box with moving boxes symbolizing renting vs buying options

Buying Pros

An investment - you build equity
Freedom to customize your space
More stable housing costs
Potential tax breaks

Renting Pros

No long-term commitment
No maintenance costs
No property taxes
Renter's insurance is cheaper than homeowner's

Buying Cons

Long-term commitment
Requires down payment*
Requires taxes and maintenance costs

Renting Cons

Builds equity for someone else
Little freedom to customize your space
No tax benefits

* Depending on loan program. Down payment implies an opportunity cost, or the potential financial benefits you could have achieved through an alternative investment path.

Home Ownership Advantages

  • Mortgage Interest Deduction
    The interest you pay on your mortgage is tax deductible for any home loan up to $1 million dollars. Interest makes up most of your mortgage payments early on, so this is a helpful tax perk for new homeowners.
  • Mortgage Insurance
    If you purchase a home with less than 20% down and have to pay mortgage insurance, you can deduct those payments on your taxes as long as your adjusted gross income (AGI) is less than $109,000.
  • Sales And Real Estate Taxes

    The sales tax you pay when you buy your home is also tax deductible. This is especially helpful if you live in a state without income tax or if your home’s sales tax costs more than your income tax.

    And, as long as your home is your primary residence, your real estate taxes (or property taxes) are tax deductible, too.

  • Building Equity
    As you make monthly payments on your mortgage, you build equity. Equity is the current market value of your home minus the amount you owe on your mortgage. As the market value of your home increases, so will your equity. This money can be used for consolidating debt, home improvements and more.

Start Your Home Purchase Today!

Apply with our online application HomeNow or reach out to a Mortgage Banker to answer your questions. Either way, you can expect personal and attentive service to help guide you through each step of the process.

Questions? Call us at
800-947-7061
Monday - Friday from 7am to 6pm CST.

Get Started

 

Contact a Mortgage Banker

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