INVEST YOUR RENT: Why Pay Your Landlord’s Mortgage?

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1604 CrowsLand-0503The only one who benefits from a rent check is the landlord. Renters never see that money again, while homeowners usually profit when they sell. In addition, renters can’t use any of their rent payment as a tax deduction, like homeowners can. If you or someone you know is renting, it’s time to put that rent check to better use!The mortgage-interest deduction is probably the best financial argument for buying rather than renting. Consider this example:If you can afford a mortgage payment of $1,000 (principal and interest only), you can buy a house for $151,426 if you put 10% down on a 30-year mortgage at 8% interest. (Currently rates are 4%) ┬áIf your payments started in January, you would pay $10,862 in interest for the first year in the home. That entire amount is deductible on your federal income tax return! Assuming you are in the 27.5% tax bracket, you would save $2,989 in taxes, or $249 per month. So your $1,000 payment is really only $751 when you factor in the homeowner’s tax advantage.

Can A Renter Really Afford To Buy?

The real question is whether renters can afford not to buy. The tax savings alone make the purchase of a home a wise financial decision. But let’s go a step further.

Using the same example, a 10% down payment would create an immediate equity of $15,142. Assuming the $151,426 house grows in value by just 3% a year, in five years it would be worth $175,544. The original loan amount would then be down to $129,565, yielding an equity of $45,980. In addition, remember the nearly $3,000 tax savings every year. The total value of your equity and tax savings would be almost $61,000 after five years.

Pick A Loan

To take advantage of the financial benefits of homeownership, renters must first find out how much buying power they have. We can help. Call us for information about the whole range of mortgage options now available, including low- and no-down-payment loans, and programs that allow buyers wrap home-improvement costs and closing costs into the mortgage.

Plan Ahead

Although some lenders allow buyers to use up to 41% of monthly income to purchase a house, beware of becoming “house rich and cash poor.” Be sure to budget for homeownership costs beyond the mortgage, including expenses for:

moving
decorating and furnishing
homeowners insurance
property taxes
homeowners association fees (if any)
utilities-power, water, sewer, cable, trash pick-up
yard tools, supplies and general upkeep
home repairs, supplies, cleaning and upgrades.

Today, homeownership is a wonderful dream-come-true for more people than ever before. Let us help turn those dreams into a home to be proud of.

Categories: Purchase a home, Stop paying your landlords rent, Uncategorized, User friendly home designs, wilmington nc relocation

DESIGN: User-Friendly Designs For Now And Tomorrow

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You don’t have to be elderly or handicapped to appreciate the designs manufacturers are coming up with to make life easier. Think, for instance, how many times you’ve taken advantage of the ramps in sidewalk curbs designed for wheelchairs. They’ve made it easier to ride a bike and push a stroller—and even simply walk across the street. Likewise, we all can enjoy:
    • refrigerators with adjustable-height slide-out shelves to eliminate bending and reaching

  • lettering on controls and instructions large enough to read without squinting or hunting down a pair of glasses
  • non-skid cutting boards
  • contoured knife handles requiring less pressure to cut food
  • playing-card shufflers
  • tabletop book and newspaper holders
  • lamps that turns on and off by touching their base or clapping
  • lever adapters on faucets and doors to make opening and closing easier
  • bent-handled hairbrushes and long-handled bath brushes
  • easy-grip, spring-band scissors that open by themselves after you snip
  • Velcro fasteners on shoes
  • needle threaders
  • large-numbered, lighted key-pads for telephones
  • swivel seats to ease getting in and out of a chair
  • motorized chairs that lift you to your feet.

Some of these things can be found in pharmacies and department stores. For other ideas, browse through specialty catalogs.

Categories: User friendly home designs, Wilmington NC homes, Wilmington NC Market Statistics, wilmington nc weekly events


Kay Baker Associates | 1001 Military Cutoff | Ste 101 Wilmington, NC 28405 | kaybakerassociates@ec.rr.com | 910-202-3607 | Fax 910-338-2428

Copyright © 2017 Wilmington NC Real Estate Guide. All rights reserved. Disclaimer: All content on this blog is my own opinion and should not be treated as fact or relied upon when purchasing or selling real estate.