How do I know if I am ready for home ownership?

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The privacy and freedom that come with home ownership are part of the American dream... but these come at a price. Most importantly, home ownership requires capital. On top of tying up your money, owning a home means taking care of taxes and other upkeep that a landlord is responsible for when you rent. On the other hand, owning a home is likely to save you money over time (assuming you don’t buy during a housing market bubble!). Home ownership is much more feasible when you have a good credit score: good credit means a lower mortgage interest rate, and bad credit should indicate to you that you’re probably not ready for the responsibilities of home ownership. If you expect to be in one location for at least a few years, can afford a home, and have good credit, then you should consider buying.

The chart below lists some important considerations.

 RenterOwner
Responsible for Maintenance 
Responsible for Property Taxes 
Builds equity 
easy to relocate 
tax benefits 
Large down payment 
low deposit cost 
risk of foreclosure 
risk of eviction 

                                                                        

Click here for additional tips on getting started with the home buying process.