As you start to take control of your finances, you may wonder whether you should continue to rent your space or look for a home or condo to pay a mortgage on. For some people, a mortgage seems risky and symbolizes a major step in their lives. For others, it is a welcome opportunity. If you are considering buying property, here is why your mortgage is a good investment:
- You can get something back. When you rent, you write a check to your landlord every month without investing in it. You could live in the same place for years and walk away with nothing. However, a mortgage is an investment in the home. You will eventually pay off the home or get part of the money back when you go to sell.
- You can pass down the property. In the event that you pass away or move, you can give the deed of the property to someone in your family. They inherit the space and can keep making payments on it until they fully own it. Land investment is one of the most lucrative forms of inheritance.
- You can do what you want with the property. Rental properties come with strings attached. Even if you are able to make aesthetic modifications like changing the paint color, you can’t make major design decisions like remodeling the kitchen or tearing down a wall. Owning a house gives you this control and allows you to make changes that increase the resale value.
- You may end up paying less. Rent continues to skyrocket in most cities. However, if you have good credit and a fair agreement with your lender, you could pay less on your mortgage than you would if you were renting.
Knowing the benefits of paying a mortgage versus rent can help you plan your way to a successful financial future.
Sources: Mortgage Calculator, CNBC