There are a number of factors that should be taken into consideration when comparing the benefits and problems of home ownership versus renting.
No Mortgage vs. No Landlord
When you own a home you are in charge. It is yours! It belongs to you. If something breaks, you fix it. When you rent, you are living in the landlord’s house. If something breaks you need to contact the landlord to fix it. Landlords are not always very responsive to helping their tenants deal with problems in their apartments.
Fixed Rate Mortgages Don’t Go Up: Rent Does!
If you buy a house and obtain a fixed rate mortgage, you will pay the same amount each and every year. If you rent an apartment, periodically the landlord will raise your rent. It should be noted although your mortgage rate won’t go up, taxes on real property go up over time.
Homeowners Obtain Tax Deductions for Mortgage Interest
There are significant tax benefits for owning a home. You can deduct, in your federal and state income taxes, the interest paid on your mortgage. In addition, there are a variety of energy efficient improvements to the home that can be made which are also tax deductible. When you sell your home, the first $250,000 in profit payable to the owner of the home is not subject to capital gains tax.
Managing Your Own Space
When you are in an apartment there are small cosmetic things you can do. However, you cannot customize the space to meet all your needs. If you own a home, you can move walls and do anything you want with it. The space can be modified to meet all of your personal needs and/or whims.
Homeowners Can’t Be Evicted
If you rent an apartment and you don’t pay rent, thirty days afterwards a landlord can bring a summary proceeding and have you removed from the apartment. Eviction proceedings are relatively quick proceedings (although in the City of New York they can take as much as six to eight months). However, if you don’t pay your mortgage, and a financial institution has to bring a foreclosure lawsuit, those proceedings can take as long as three to five years. During that period, you can be living in your home while not making mortgage payments.
Elliot S. Schlissel is a foreclosure lawyer. He represents clients whose homes are going into foreclosure. He helps them stay in their homes, obtain mortgage modifications, and litigate a variety of issues involved regarding foreclosures with financial institutions. Elliot can be reached for a free consultation at 1-800-344-6431, 516-561-6645, and 718-350-2802.
