With Rents Skyrocketing, Now Could Be Time To Shop For A Mortgage Online

August 24, 2016

For decades, those looking to save money on housing costs have been told one thing – rent, don’t buy. And for decades, that advice was right.

But with rent on the rise across the country, the relevance of that wisdom is being called into question. Is it really less expensive to rent, when you could potentially lock down a mortgage with cheaper monthly rates?

The answer depends on your current financial situation, as well as where you’re at in life. Read on to find out if you could save a bundle by signing a mortgage rather than a lease.

Why Get a Mortgage Now?

Rent is increasing around the country, and it doesn’t seem to be slowing down anytime soon. Even smaller towns are feeling the housing squeeze. Meanwhile, interest rates are still reasonable – about 3.45% for 30-year mortgages and 2.76% for 15-years according to Freddie Mac.

If you choose to buy a home instead of rent, you’ll build equity, save money through homeowner tax deductions and potentially end up with a mortgage cheaper than your current monthly rent.

If you choose to wait to buy a home, prices may increase in your area and make it harder for you to find a home you can afford. Plus getting a mortgage allows you to lock down your housing costs for the next 15 years or more, while rents can increase suddenly – forcing you to move or pay up.

Why Shop for a Mortgage Online

At one point in time, the idea of finding a lender online was ridiculous – but those days are long past. Choosing a lender online is incredibly safe today, and you can compare a variety of mortgage offers faster online than you can through brick-and-mortar banks.

Some mortgage providers can also show what you pre-qualify for, so you don’t have to fill out a bunch of applications to see if you’re even eligible for the homes you’re looking at. If you’re looking to test the waters of homeownership without having to set up an appointment and drive across town, this is the option for you.

When You’re Ready to Buy a Home

  • When you’re committed to your location. Buying a home can be a great idea, but only if you’re ready to settle down. Staying in a home for at least five years is recommended if you don’t want to risk losing money on your purchase. Think hard about whether or not you’ll be staying put.
  • When you can afford it. Buying a home isn’t just about making monthly mortgage payments. It’s about saving for a down payment, paying for home repairs and being prepared for anything that may come along. You need to have both the time and money to take care of a home, and it can be more costly than you think.
  • When you have a stable job. If you’re used to flitting around from one job to the next, buying a home may not be in your best interest. Lenders like to see that you’re stable and able to keep a job for a few years. They also know that you’re more likely to afford your mortgage payments and won’t default on your loan if your job is secure.
  • When you want more options. Renting is great for people who aren’t sure of what they want in life, but home ownership is for people who are certain. If you’re sick of not being able to paint your walls or change your home’s layout, you may be ready to buy a home. Unlike renters, homeowners can get a dog, install a pool or create the man cave they’ve always wanted.

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