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5 Financial Reasons You Should Never Buy A Home

5 Financial Reasons You Should Never Buy A Home. Thinking about buying a home for the first time?

Many people think that at a certain age or because they are married and start a family, they have to buy a house. They believe that it’s what they are expected to do or it’s the next step. But that can be a financial mistake. Even if you can afford a mortgage, there’s more to owning a home.

For example, after you buy a home, you will also need extra cash to account for repairs, property taxes, insurance. You also have to make sure you can keep a job in order to make the mortgage payments. So before you buy a home, make sure you are ready to do so. In this article, we will provide some of the common financial reasons you should never buy a home.

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5 Financial Reasons You Should Never Buy A Home

1. Homes are very expensive.

Homes are costly to buy. The average sale price for a home in the United States in 2018 is $394,300. That means that you will have to come up with a large down payment (usually 20 percent of the home purchase price) plus closing costs and fees.

In addition, you have to make sure you can cover the monthly mortgage payments once you buy the house. There’s also property insurance, taxes, homeowner associations fees (if you own a condo), water bill, electricity bills you have to think about.

If you feel you have enough money saved for a down payment on a house and you have a stable job, then buying a home might be a good option for you than renting.

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2. You’re not handy.

When you own a home, you also have to keep up with the place, including painting, cleaning, making repairs, mowing the lawn, etc.. If you’re not a handy person, you will have to pay for professionals to do these things. And the cost of home maintenance can eat up your savings. So if you’re not a handy person and don’t have the money for these maintenance costs, you’re better off renting a home rather than buying a home.

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3. You’re too busy.

Similar to reason number 2, you should not buy a home if you’re too busy in your day-to-day job and paying for someone to do the yard work for you can be costly.

4. You don’t have a stable job or a stable source of income.

If you don’t have a stable job or stable source of income, you may not be able to make on time payment. And late mortgage payments can have serious consequences. The great thing about renting rather owning a home is that you don’t have any real obligation, besides the lease. If you can’t make your monthly rental payments, the worst thing that can happen to you is eviction from the property. But with owning a home, if you make late mortgage payments, the bank can foreclose on your property.

5.  You’re planning on moving.

If you know you’re planning on moving to another state or country, or that your job might transfer you to another location, you are better off renting a home than buying a home. The rule of thumb is that you buy a home if you are going to live in it for at least 5 years.

In conclusion, although there are some great benefits in buying a home, a lot of times it just doesn’t make sense. If any of these financial reasons above apply to you, you may be better off putting off buying a home.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

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