Buying versus Renting home dilemma

Most people buy homes for very emotional reasons. Maybe friends owning homes are constantly talking about their home improvement projects. Maybe family members keep asking when it will be their turn to host the family Thanksgiving. Are you adding children or family members to your household? Any or all of their emotional tugs give rise to home-ownership dreams. But how do you know if it is time for you to purchase?

Most people who rent can actually afford to buy their own home. So what is stopping them?

A lot of people believe that owning a home requires a big down payment which is difficult to save while paying all their regular monthly bills. Others are convinced they wouldn't qualify for a mortgage, and that the payment would be too much anyway.

Here are a few facts that may help in your decision:

FACT: The average mortgage payment costs about the same, often less, as the average rent payment. For example if you are paying $850 per month in rent, you could be making mortgage payments on your own $85,000 - $90,000 home. That would probably buy you a lot more space (and privacy!) than you have right now.

FACT: Many sellers are willing to pay all or part of your closing costs when you purchase a home.

FACT: The majority of renters surveyed said the biggest reason they don't even check to see if they can buy a home is that they are afraid of pushy salesmen, or feeling obligated to buy when they are not ready.

How do you stay in control, and figure out how much home you qualify for?

I always counsel people to talk to a real estate lender and get pre-qualified before they step a foot out the door to look for homes. There are so many things this accomplishes.

• First: You are in control at this point. You know what you can afford, and what kind of real estate loans you can get. You also know if you need the seller to pay closing costs and can use this in your bargaining.

• Second: You want to get pre-approved with a good lender. With the problems that happened in the morgage industry this last year this is most important than ever. I have an excellent lender that I can refer you to; ask me for her name.

• Third: If you have credit problems, you have time to get them off your record. A good lender will help you do this. If you wait until after you have found a home you love, you may lose it if your have credit glitches that could have easily been handled first.