Renting vs. Buying

A mortgage is a lien on a property or house that secures a loan and is paid in installments over a set period of time. Mortgages come in many different shapes and sizes – but not every mortgage is right for every borrower. Before sitting down with a lender, it is important to first assess your own financial situation.

Remember: Home ownership is quite different from renting. Just because you pay $750 per month in rent doesn’t necessarily mean you can afford a mortgage with monthly payments equal to $750. That’s because as a homeowner, you’re responsible for many other costs beyond just your mortgage payment – such as taxes, repairs, water, sewer, heat, trash collection and a whole range of other costs you may not have had as a renter.

• The Government National Mortgage Association (Ginnie Mae) has created a Buying vs. Renting Calculator to help you decide which is the better option for you based on your current financial situation.

 

Next: How Much House Can I Afford?