In my previous profession as a Realtor, I always was an advocate owning instead of renting. I heard one of three things most of the time. “I don’t want the responsibility”, “My credit isn’t good enough”, or “It’s too expensive” all of these are great excuses to think of but none are true. Fear has a great ability of keeping people in a box. In this blog I will address the top three rumors of ownership. I will also throw some benefits of ownership. Finally I will get into the renter’s mentality a little.
The mind controls the body as we all should know. So if you think of something and believe it, chances are it becomes your reality right? This is so relevant to these excuses. I was taught that we live in a world of infinite possibilities. So if you think these excuses are relevant, you will make them your reality. “I don’t want the responsibility” this is understandable and honest to an extent. How I would put it is, the responsibility is a lot for a house, yes there are repairs, landscaping, extra utilities, homeowners insurance, alarm systems that you need. Most of it balls down to Money, Money, Money right? What about a condo or a co-op? It’s an apartment that you own. The maintenance fee that you pay, includes all the things I just mentioned and they tend to be affordable when you break down the numbers. If the issue is money, I really don’t understand the mentality. Let me state some facts in the form of a question. Every year or every end of the lease; doesn’t rent go up? unless you have a great landlord, then it most likely goes up. Do you think a mortgage goes up? We all know about adjustable rate mortgages and why we should stay with a fixed rate mortgage right? In case you don’t know, let me tell you. An adjustable rate mortgage is one that starts with a low-interest rate and increases over the years(something like a lease). A fixed rate mortgage, on the other hand has the same rate throughout the term. So with a fixed rate mortgage, your payment will stay the same for 15 or 30 years. So that rent increase, goes straight to profit in the homeowners pocket. Going into the next one “it’s too expensive” lol, I think that it’s too expensive not to be a homeowner! For the simple fact that when you pay rent, you cannot claim that as a deductible on your taxes, as I mentioned in my previous link, the interest that you pay on the home are tax-deductible, home improvements raise value to the house. So all you do it yourself home improvement people who rent and take ownership of that property, everything you fix and improve, keeps that property value up, but guess who’s going to profit from the sale? Not you, unless you own it. Taking the good out of it, at least you get the experience. Now directly addressing the finance issue. Home ownership does require a down payment. Conventional is from 20%-30% down but this is only advised for previous homeowners that are either selling their house or using the equity to make a bigger purchase. FHA only requires 4%-5% down. Then there are home ownership programs that help with down payment assistance. Last and most common one ” My credit isn’t good enough”. Credit can be a major hurdle. BUT not a wall! There are ways to fix your credit in 3-6 months, banks are taking 600 scores right now. Not to mention, you might run into an investor who you can talk to that may do a rent to own situation. This would give you a chance to rent the house out and when the homeowner decides to sell you get first dibs or if discussed and agreed upon can be sold after the lease is up a portion of the rent that you were paying, goes toward the down payment for your home.
Lets talk about benefits. I’m not here to repeat what I stated before. I’m going to talk about some different benefits. With ownership, the government and community looks at this differently than renting. Main reason, a person renting can be there for 2 years and leave. When you buy property, you make an agreement or commitment for 15-30 years. So when a renter has an issue in the community or a homeowner has an issue in the community, who do you think will have a bigger voice? We all like to think that everyone has an equal voice or say but the truth is, the homeowner pays taxes on the land and taxes on income for a long time, renters come and go. Home owners know other homeowners and the more property owned, the bigger the voice becomes. You want a nice car right? You can actually take a home equity loan against the equity of your house to purchase the car, then pay that off over time. That’s called leveraging my friends. Finally just imagine this, once you pay off your mortgage, that house is yours. You can will it off so it stays in your family, you can sell it, you can rent it out, you can let it sit there and rot if you wanted to. Having a house is a big responsibility but it is also a great asset. We all need a place to live right?
I’m going to tread lightly on a topic renters mentality. As I worked in many financial fields, I notice MOST and not all renters share a mentality of short term thinking and they get comfortable in their situation. Nobody in their right mind would say, “I’m going to rent an apartment or maybe get a nice rental home for the rest of my life”. We somewhere down the line get comfortable in our situations and stay there. No offense to anyone at all. Educating yourself on how to attain ownership instead of comforting yourself on why you should stay where you are should be a goal and a mission. Change and growth is a part of life, lets start challenging one another to do more and stop comforting each other, Misery loves company and success is lonely… Which side would you rather be on? If I had a chance to make a change in my life and I would have to sacrifice being popular, I’m definitely going to change my life. Popularity is for high school and I’m quite grown. If I have to live a life of moderation and conservation for 5 years to live in abundance for the rest of my life, I will sacrifice having designer clothes, I will walk and take the train, I wont buy any jewelry, Party every weekend, I will even get public assistance to pursue my goal. What’s sad is that most Americans are too spoiled and egotistical to accept what it is. I’ve seen people in the Russian community come to america, get public assistance, go through garbage to find furniture and work hard. They sent their kids to school, opened up businesses and in 10 years they had furniture companies, their kids are doctors, lawyers, accountants, etc and they are homeowners with nice cars as well. Now they are working smart, not hard.
I have no problem with renting. Lets make a plan and work on it to become a home owner because renting is temporary. Lets work around our issues and make them disappear so our goals can be realized. If any of the excuses have passed your mind, or you are in situations where you want more but don’t know how to get there, feel free to contact me. I’m sure if I personally cant help you, I definitely know someone that can!
Related articles
- The Advantages of Home Ownership (fidelityphoenix.wordpress.com)
- When Should I Buy A Home? – VAHomeLoans.net (vahomeloans.net)
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