Comparing Renting a Home versus Buying a Home
Many renters think that purchasing a home is more difficult than it actual is. In today’s market, there are many deals on homes in California, Florida, Texas, Indiana, Illinois, Kentucky and throughout the United States. Homes that were appraised at $300,000 plus are now going for substantially less. One of my mortgage loan clients realized that renting a home versus buying a home was not for him and just got a house under contract for $150,000 in northern Illinois. The seller of the home purchased it in 2006 for $280,000. The best part of this deal is that my client’s new housing expenses, principal, interest, taxes, and insurance is less than their current rental payment.
Renting a home versus buying a home has its advantages as well as disadvantages
Both renting a home versus buying a home has its advantages and disadvantages. One of the main advantages of renting a home versus buying a home is that a renter has no liabilities in being a homeowner. If the renter needs to move elsewhere, they can just give the landlord a 30 day notice if they are month to month or move at the termination of their annual lease. A homeowner would need to either rent their home or sell their home before they are able to move. You would not want to leave your home vacant. Another advantage of renting a home versus buying a home is that a renter does not have to worry about major maintenance of the home such as roof repair, furnace repair, electrical repair, and other major repairs.
Many Renters are First Time Home Buyers
Many renters are not knowledgeable in how to go about purchasing a home and many think that they need a substantial down payment as well as great credit. A renter can qualify for a mortgage loan on a home purchase if they have at least 3.5% down payment and a full time job. As long as a renter has a two year work history, fair credit, and the down payment, they can qualify on a mortgage loan. For those who have bad credit or a prior bankruptcy or foreclosure, there are certain requirements.
Home Loan with Bad Credit
For those renters who have filed bankruptcy, there is a 2 year waiting period from the discharge date of the bankrutpcy in order to qualify for a mortgage loan on a home purchase. For those who have had a foreclosure, short sale, or a deed in lieu of foreclosure, the waiting period is 3 years from the date of the sheriff’s sale or the date the name of the homeowner was transferred out of their name into the name of the mortgage lender.
Minimum down payment and Minimum credit scores to qualify for home loan
To qualify for a 3.5% down payment FHA mortgage loan, the minimum credit score required is 580 FICO. I do have wholesale mortgage lenders who will qualify mortgage loan borrowers with open collections. If a mortgage loan borrower has credit below 580 FICO but higher than 530 FICO, they can still qualify for a mortgage loan but a 10% down payment is required.
If you are a renter interested in being a homeowner and see if you qualify for a mortgage loan, please contact me at 261-716-8151 or email me at firstname.lastname@example.org or can visit me at www.gustancho.com . We can discuss the benefits of homeownership and the advantages of renting a home versus buying a home. I have great first time home buyer mortgage loan programs.