Should Military Families and Active Duty Members Buy a House or Rent
Should
Military Families and Active Duty Members Buy a House or Rent
There is a great
debate among active duty military regarding renting or buying a home in US.
Because these military members may be called upon to deploy or change
duty stations at any moment, numerous active duty families choose to
rent. Still, others have determined that despite an unpredictable
lifestyle, it is better to invest in real estate by purchasing a
family home.
Financial
and Career Based Consideration:
1.
Cost and Monthly Payments:
If your family is
moving to a part of the country in which this has occurred, and you
have determined that a monthly mortgage will be cheaper than the cost
to rent, the temptation to buy may win out. But before you start
visiting open houses.
2.
Market Consideration and Pricing:
Home buyers must
consider numerous factors in addition to the mortgage and down
payment, such as the price of the home versus the average price
within the local area, the rate of foreclosure, and health of the
local market. Other factors to take into account include real estate taxes, home ownership association fees, and the cost of insurance,all of which will increase the monthly cost of your home.
3.
Tax Benefits:
Don’t forget that
when you own a home, you get to deduct the mortgage interest you pay
on your loan from your taxes. This effectively decreases your monthly
home expenses (which include mortgage payment, real estate taxes,
home owner’s insurance, and any association fees) and should be
taken into account to determine the true cost of home ownership.
Let’s be honest.
Most military families are not typically stationed in one location
for their entire career. Because of this, they need the ability to
move on without substantial, or ideally any, investment loss.
Therefore, it is important that a purchased home be one that is very
marketable. A home can be marketable for the purposes of selling or
renting.
5.
VA Home Loan Eligibility:
If you choose to
finance your home using the Department of Veterans Affairs Home Loan,
be aware of eligibility requirements and how they may impact a future
relocation. VA loans are only permissible for the purchase of your
family’s primary residence. Moreover, if you move away from your
primary residence without selling it, you will be restricted from
using another VA Loan for a subsequent home purchase until the first
mortgage is paid off.
6.
Expected time in Current Duty Station:
Most importantly,
are you willing to hold onto the property as a rental after you move?
These days, it can take many months, even years, to sell a home.
You’ll also want to consider closing costs when you buy and sell,such as mortgage points and commissions, which can effectively increase your monthly mortgage payment by hundreds of dollars over a
short period of time and reduce your sales revenue by thousands.
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