I read somewhere that renting is the new American dream – especially for young borrowers entering the market after 2008. I rented for more than a decade and there was a lot to like about the freedom of renting: not being solely responsible for the property, and knowing that it was easy to pick up and go when needed.
But with that freedom comes a few costs. The property was not mine and I was beginning to want small things: a yard for my garden, a dog, my walls to be painted green. And then I realized something even more striking. My rent was my landlord’s mortgage payment! I wasn’t getting any long term financial benefit from my choice to rent.
As a homeowner, each monthly payment cuts down on what you owe. Once you sell your house, the difference between the sales price and what you owe is money in your pocket.
I began to reconsider my love of renting and was nervous I wouldn’t qualify for a mortgage. Like a lot of people, I had credit card debts and previous issues with loans. I looked for a financial institution that would help me figure it out. I spoke with a mortgage loan officer and got a solid understanding of what I needed to become a qualified borrower. With time, I was able to be approved for a mortgage.
I purchased my home in November 2016. As it turned out, my mortgage payment was about the same as my monthly rent. There were some new expenses, of course. If something breaks, it’s on you. The yard work is up to you. All utilities and home maintenance needs to come out of your pocket. But, it feels worth it.
It’s great being a homeowner. I love standing in my green kitchen watching my dog play in my backyard. I have a significant feeling of satisfaction as a home owner that I never felt as a renter. Also, I am excited about the potential value of my property.
The most important thing I had to realize is that there are costs to consider beyond the mortgage payment. If you’re on the fence, try attending one of the First Time Homebuyer’s seminars VACU offers. It’s worth looking into.
Stephanie is a Lending Advisor at Virginia Credit Union. The middle child of a 7-person family, Stephanie enjoys helping others and bringing people together.
Other stories by Stephanie R.